The bond market had another solid day today, although that wasn't necessarily destined to be the case from the start.  Yields were slightly higher in the first half of the overnight session and didn't begin to recover until equities futures  moved lower at the start of European trading hours.

Bonds actually pushed back in a weaker direction at the 8:20am CME open, 5 minutes after an equivocal reaction to an equivocal ADP Employment report, but the losses were short-lived.  As stocks continued to drop, bonds increasingly stepped into the role of "safe-haven" and happily soaked up some of the cash that was seeking the sidelines ahead of 2 more big days of econ data.

As is typically the case for a flight-to-safety bond rally, Treasuries fared better than MBS.  Regardless of the motivation, that still likely would have been the case simply because the mortgage market has had quite enough when it comes to bond rallies and lead changes over the past 2 months.  

Tomorrow brings the non-manufacturing version of the report that rocked markets yesterday (ISM PMI).  It hits at 10am ET and has just as much potential to cause a stir as its counterpart.


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
101-22 : +0-04
Treasuries
10 YR
1.6010 : -0.0430
Pricing as of 10/2/19 5:22PMEST

Today's Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
8:33AM  :  Bonds Slightly Weaker After ADP Data

MBS Live Chat Highlights
A recap of featured comments from the Live Discussion on the MBS Live Dashboard.
Matthew Graham  :  "more wagering than probability, actually. And it pertains to the effective rate, not the target rate, so if there's any sort of temporary funding disruption as there was near the time of the last futures deadline, it can throw the probability way off."
Ted Rood  :  "So more for amusement than actual wagering purposes?"
Matthew Graham  :  "yep, just take it with a grain of salt as it's not a perfect reflection of probability or expert opinion. That said, I think it's probably pretty fair right now. Data between now and then could change things, of course."
Steve Waskiewicz  :  "thanks MG. Great resource."
Dustin McAlister  :  "way behind on my reading, is a .25% OCT rate cut priced in at this point?"

Economic Calendar
Time Event Period Actual Forecast Prior
Wednesday, Oct 02
7:00 MBA Purchase Index w/e 263.8 261.4
7:00 Mortgage Refinance Index w/e 2202.6 1928.0
8:15 ADP National Employment (k)* Sep 135 140 195
Thursday, Oct 03
7:30 Challenger layoffs (k) Sep 53.480
8:30 Jobless Claims (k) w/e 215 213
10:00 ISM N-Mfg Bus Act * Sep 59.0 61.5
10:00 ISM N-Mfg PMI * Sep 55.0 56.4