To be clear, bond markets are indeed in their weakest recent territory AFTER this morning's economic data, but NOT necessarily BECAUSE of it.  While Treasuries and MBS had visible reactions to the ADP data and even to Factory Orders, neither of the two reports were any sort of shining example of market-moving prowess.

Instead, this move has been in the works since late March when bonds prematurely exhausted a month/quarter-end rally.  The bounce back was largely a matter of momentum shifting into the new month (which is why weaker Chicago PMI on Monday and weaker ISM Manufacturing on Tuesday did little to deter further weakness.

"In the works" in this case doesn't necessarily mean we were destined to hit 2.80% in 10yr yields today--simply that we were already in the process of bouncing off the lower end of the rate range.  The extent to which we're destined to move higher is tentatively 'limited' by the upper end of range boundary, which we get from March 7th's 2.82% highs.  Again, 'limited' doesn't mean rates won't go higher, just that it's a significant move if they do.  The days leading up to NFP reports are prime candidates to see these sorts of "lead-offs" outside the range--usually into weaker territory. 

As of right now, we're not even officially leading-off outside the recent range--simply pushing right up to the edge of it.  That's still plenty unpleasant for rate sheets though.  Fannie 4.0s are down a quarter point.