Another swing and another miss for today's economic data.  It had an opportunity to kick start what stands a good chance to be a fairly big move in multiple markets.  At the heart of that potential volatility is the Fed--particularly last week's comments from Vice Chair Fischer which highlighted the current 2-week time frame as having some bearing on whether or not the Fed hikes rates in September.  NFP weeks are clearly big data weeks, and a September Fed rate hike would clearly be a big event.  Connecting the dots, it's reasonable to assume any major commentary from data will be taken as a cue for the Fed to hike or hold off.

In other words, if the employment data were to come in much stronger than expected, markets would brace (more than they already have) for a Fed rate hike.  If NFP is much weaker than expected, the market result is a bit less intuitive, but likely positive for bonds.

Whatever the reaction we see from NFP, today's ADP data had a chance to get it started.  But markets didn't do much with the 190k vs 201k result.  It is somewhat interesting to note that what little activity we saw after ADP was weaker for bonds.  This might suggest the bar is set fairly high for negative data to dissuade the market's perception of the Fed's stance. 

By the end of the day, we'd seen a big swing (relative to the narrow range) back to the highs of the day, and another big swing back to post ADP levels.  The damage remained contained with MBS only losing about an eighth of a point and 10yr yields up 2.8bps.


MBS Pricing Snapshot
Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing is available via MBS Live.
MBS
FNMA 3.0
100-19 : -0-05
FNMA 3.5
103-24 : -0-04
FNMA 4.0
106-10 : -0-03
Treasuries
2 YR
0.7120 : +0.0000
10 YR
2.1880 : +0.0280
30 YR
2.9540 : +0.0350
Pricing as of 9/2/15 5:51PMEST

Today's Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
3:09PM  :  ALERT ISSUED: Negative Reprice Risk Increasing Again
2:33PM  :  ALERT ISSUED: Pace of Selling Might Make Some Lenders Uneasy
8:50AM  :  ALERT ISSUED: Bond Markets Unhappy About Something (What it is ain't exactly clear)

MBS Live Chat Highlights
A recap of featured comments from the Live Discussion on the MBS Live Dashboard.
Matthew Graham  :  "RTRS- U.S. FEDERAL RESERVE'S BEIGE BOOK SAYS ECONOMIC ACTIVITY CONTINUED TO EXPAND FROM JULY TO MID-AUGUST"
Edie Clark  :  "SK and Hugh, thank you so much...I've been reading Allregs for 30 minutes and could not find yay or nay. Thanks!!"
Sung Kim  :  "for FNMA, yes, LP always been like that but most investors overlayed"
Hugh W. Page  :  "SK correct on Investor Condo Edie - 85%LTV but you can't do limited review on condo - need full approval."
Sung Kim  :  "Edie - you can purchase condos NOO, but the condo requirements are much more stringent, more specifically owner occupancy ratio, all the other stuff AUS will tell you"
Edie Clark  :  "Where in Fannie Mae Guidelines does it address whether or not an Investor can purchase a Condo Unit. Thanks!"
John Murphy  :  ""Non re-affirmed=included in BK". Most servicers hold payments in suspense account as the mortgage no longer exists and up to their discretion to allow a "refi". Stop paying "rent"=foreclose. tats what I've seen typically. YMMV"
Dominick Cordone  :  "I have closed several non reaffirmed mortgages. I just needed to show the proof of payment (most lenders are still reporting it but would need a VOM or credit sup to prove timely payment)"
JOSEPH BUXTON  :  "I doubt any lender will touch a non-reaffirmed mortgage. A mortgage not reporting to credit however has never been an issue for the lenders I've worked for, just need a full VOM. "