Today wasn't necessarily a worst-case-scenario for bond markets, but it was reading from the same script.  It's the version of the story where the economic data is weaker than expected, but where bonds sold off anyway.  From yesterdays close of 101-28, Fannie 3.0s are trickling sideways at 101-14 in late Friday trading.  10yr yields meanwhile are up 7.3bps at 2.108. 

Traders were obviously waiting to make sure the data wasn't weak enough to ruin their selling plans.  With the employment component of ISM Manufacturing at the lowest levels since September 2009, it was arguably plenty weak, yet traders sold bonds anyway

As we discussed in advance, this is not what we wanted to see.  It suggests an ongoing, deeply-rooted negative bias in bond markets.  Secondarily, it confirms that yesterday afternoon was indeed fueled by month-end bond buying.

Long story short, all of the cautionary hypothesizing we've been doing in April LOOKS like it's in the process of coming to fruition.  It makes sense to guard against that eventuality until it can be ruled out. 

MBS Pricing Snapshot
Pricing shown below is delayed, please note the timestamp at the bottom. Real time pricing is available via MBS Live.
FNMA 3.0
101-14 : -0-14
FNMA 3.5
104-16 : -0-12
FNMA 4.0
106-23 : -0-07
2 YR
0.5990 : +0.0240
10 YR
2.1120 : +0.0770
30 YR
2.8260 : +0.0820
Pricing as of 5/1/15 4:34PMEST

Today's Reprice Alerts and Updates
A recap of Alerts and Updates provided to MBS Live subscribers.
10:45AM  :  ALERT ISSUED: Additional Negative Reprice Risk
10:12AM  :  ALERT ISSUED: Slight Negative Reprice Risk for Early Lenders
9:58AM  :  Holding Ground at Moderately Weaker Levels Ahead of ISM Data

MBS Live Chat Highlights
A recap of featured comments from the Live Discussion on the MBS Live Dashboard.
Joseph Daquino  :  "Nothing wrong with a little pipeline protection........for now."
Hugh W. Page  :  "If we have follow through selling next week that takes us up into the 2.20's I'll get a little (lot) more worried. Until then, no sense of panic."
Bromi Krock  :  "agreed MG, momentum has shifted and you can't fight momentum."
Victor Burek  :  "I'm not gonna read a lot into today..its Friday...more interested in seeing how next week starts"
Matthew Graham  :  "uptrend is here until it's not, know what I mean?"
David Rudnick  :  "MG, your last update made it sound like we're screwed... the uptrend is here so deal?"
Victor Burek  :  "1 year, and 6 month look okay"
Christopher Stevens  :  "One ugly chart the last 2 1/2 days. "