http://www.mortgagenewsdaily.com/topic/mbs Mortgage Rates Blog https://www.mortgagenewsdaily.com/markets/mbs-recap-05082026 Fri, 08 May 2026 19:34:37 GMT 69fe4930a6791958c5ba032a Matthew Graham Calm and Slightly Stronger, But Volatility Will be Back Once or twice per week, the bond market manages to post a fairly calm trading day against the prevailing backdrop of generally higher volatility. Today was such a day. The most helpful catalyst was an absence of any major war-related headlines and associated oil price volatility. That said, it's a near certainty that war-related volatility will be back in the coming week.  Econ Data / Events Average earnings mm (Apr) 0.2% vs 0.3% f'cast, 0.2% prev Non Farm Payrolls (Apr) 115K vs 62K f'cast, 178K prev Participation Rate (Apr) 61.8% vs -- f'cast, 61.9% prev Unemployment rate mm (Apr) 4.3% vs 4.3% f'cast, 4.3% prev Consumer Sentiment (May) 48.2 vs 49.5 f'cast, 49.8 prev Sentiment: 1y Inflation (May) 4.5% vs -- f'cast, 4.7% prev Sentiment: 5y Inflation (May) 3.4% vs -- f'cast, 3.5% prev Market Movement Recap 08:32 AM No major reaction to jobs report. MBS up 2 ticks (.06) and 10yr down 1.5bps at 4.375 10:46 AM Slightly stronger but leveling off.  MBS up 6 ticks (.19) and 10yr down 3.6bps at 4.356 02:13 PM MBS up 5 ticks (.16) and 10yr down 3.5bps at 4.356 Mortgage News Daily 0 http://www.mortgagenewsdaily.com/rss/mbs https://www.mortgagenewsdaily.com/markets/mbs-morning-05082026 Fri, 08 May 2026 13:00:43 GMT 69fdec9ca6791958c5b95271 Matthew Graham Everyone's been talking about the ongoing change in the significance of the payroll number in the jobs report. OK, not everyone, but economists and bond traders for sure. The issue is the rapid shift in the size of the labor force as well as recent volatility in the multiple jobholder category, among other things. Specifically, the labor force has been shrinking since November and was already growing at a slower rate before then. That means it takes a lower NFP number to keep unemployment flat. More importantly, it means that NFP is no longer the be all, end all economic indicator. For decades, NFP has been the go-to number in the jobs report while the unemployment rate was an afterthought. Now, it's the complete opposite. That's why NFP can come in at 115k vs 62k today while unemployment is 4.3 vs 4.3 and bonds are just a hair stronger (never would have happened before these structural changes began). Mortgage News Daily 0 http://www.mortgagenewsdaily.com/rss/mbs https://www.mortgagenewsdaily.com/markets/mbs-recap-05072026 Thu, 07 May 2026 19:24:16 GMT 69fcf558a6791958c5b78dc9 Matthew Graham Another Mid-Day Reversal Driven by Dueling Headlines The overnight session featured a modest but clearly-defined rally in response to hopeful headlines on the Iran war. But as early a 9am ET, a complete reversal was beginning to take shape. Bonds remained in positive territory until the 11am hour when war headlines kicked selling into higher gear. Specifically, reports suggested Iran rejected the U.S. framework that helped bonds overnight. Separate news cited CIA sources, claiming Iran can withstand a Hormuz blockade for months. Selling continued in the afternoon on reports that had more to do with escalation risks (Saudi Arabia and Kuwait allowing U.S. forces to operate from their bases, explosions heard in Southern Iran). All told, 10yr yields were up more than 4bps by 3pm and MBS were down a quarter point. Econ Data / Events Challenger layoffs (Apr) 83.387K vs -- f'cast, 60.62K prev Continued Claims (Apr)/25 1,766K vs 1800K f'cast, 1785K prev Jobless Claims (May)/02 200K vs 205K f'cast, 189K prev Unit Labor Costs QoQ FinalQ1 2.3% vs 2.6% f'cast, 4.4% prev Market Movement Recap 08:32 AM stronger overnight and no reaction to econ data. MBS up an eighth and 10yr down 1.5bps at 4.331 11:31 AM moving into weaker territory now. MBS down 1 tick (.03) and 10yr up 1.4bps at 4.361 01:13 PM New lows for MBS, down 5 ticks (.16) on the day. 10yr up 3.4bps at 4.38 03:00 PM MBS at new lows, down 9 ticks (.28) and 10yr up 4.3bps at 4.39 Mortgage News Daily 0 http://www.mortgagenewsdaily.com/rss/mbs https://www.mortgagenewsdaily.com/markets/mbs-morning-05072026 Thu, 07 May 2026 13:08:19 GMT 69fc9d74a6791958c5b6da65 Matthew Graham Bonds and oil rallied again in the overnight session, though not as swiftly as they did yesterday. News was thinner, but there was still an obvious catalyst just before 3am with a WSJ report that the U.S. provided Iran a detailed framework to end the war. The line item that caught the market's attention was a change in the moratorium on uranium enrichment. Previously, it was permanent, but the new framework calls for 20 years. 10yr yields rallied several bps on the news and oil prices moved down about 4 dollars. There hasn't been much volatility in bonds since then with 8:30am data proving to be a non-event. Mortgage News Daily 0 http://www.mortgagenewsdaily.com/rss/mbs https://www.mortgagenewsdaily.com/markets/mbs-recap-05062026 Wed, 06 May 2026 20:15:40 GMT 69fbaf90a6791958c5b51e0a Matthew Graham Pre-Market Gains Stuck Around All Day The entirety of the domestic trading session was very flat compared to the ground covered during the overnight session. Pre-market headlines regarding a potential peace deal accounted for a 7bp drop in 10yr yields and 3/8th point improvement in MBS. 10s gained about 1 more bp by the close and MBS added another eighth of a point, bringing to total rally over half a point on the day as of 4pm ET.  There were no other notable market movers by the time domestic trading hours began. The rally speaks to the likelihood that an official peace deal could create more rally momentum, but also to the market's susceptibility to war-related headlines.  Econ Data / Events MBA Purchase Index (May)/01 171.1 vs -- f'cast, 177.7 prev MBA Refi Index (May)/01 928.6 vs -- f'cast, 977.9 prev Mortgage (Mar)ket Index (May)/01 285.3 vs -- f'cast, 298.5 prev ADP jobs (Apr) 109K vs 99K f'cast, 62K prev Market Movement Recap 08:16 AM Stronger overnight on reports that a peace deal was within reach. Both sides have since refuted those reports. 10yr still down 5.7bps at 4.368 and MBS are starting out about 3/8ths higher. 11:19 AM At best levels. MBS up half a point and 10yr down 7.6bps at 4.349 01:42 PM holding near best levels. MBS up half a point and 10yr down 7.7bps at 4.348 Mortgage News Daily 0 http://www.mortgagenewsdaily.com/rss/mbs https://www.mortgagenewsdaily.com/markets/mbs-morning-05062026 Wed, 06 May 2026 12:49:24 GMT 69fb4744a6791958c5b449b6 Matthew Graham There was one, big, obvious market mover overnight. At 4:50am ET, Axios reported that the U.S. and Iran are close to signing a one page memo of understanding to end the war. Oil and bond yields were already in recovery mode, but this kicked things into higher gear. Most of the gains remain even after both sides offered refutations (which the market now perceives as merely a negotiation tactic). Subsequent reports from other sources also speak to specific details in the peace deal that seem to specific to be made up. In early trading, ADP employment data had no impact and Treasury's confirmation of unchanged auction sizes helped bonds hold the overnight gains. Mortgage News Daily 0 http://www.mortgagenewsdaily.com/rss/mbs https://www.mortgagenewsdaily.com/markets/mbs-recap-05052026 Tue, 05 May 2026 19:20:59 GMT 69fa512ca6791958c5b2c7d7 Matthew Graham Data Didn't Hurt, But Bonds Underperformed The Oil Price Recovery Today's headline is somewhat misleading. It points out the fact that oil prices made it back to yesterday's lows whereas bond yields didn't even come close. This is all true, assuming we're looking at front month oil prices. But if we use a longer-term futures contract for oil, the correlation with bonds was actually closer to 1:1. Either way, the bond rally only unwound a fraction of yesterday's losses and that's especially true for MBS (5.0 coupons lost half a point yesterday, but regained less than a quarter point today). Econ data didn't hurt, but it didn't exactly help either. ISM and Job Openings were both very close to consensus. Econ Data / Events Trade Gap (Mar) -60.30B vs $-60.9B f'cast, $-57.3B prev S&P Global Services PMI (Apr) 51.0 vs 51.3 f'cast, 49.8 prev ISM Biz Activity (Apr) 55.9 vs -- f'cast, 53.9 prev ISM N-Mfg PMI (Apr) 53.6 vs 53.7 f'cast, 54.0 prev ISM Services Employment (Apr) 48.0 vs -- f'cast, 45.2 prev ISM Services New Orders (Apr) 53.5 vs -- f'cast, 60.6 prev ISM Services Prices (Apr) 70.7 vs -- f'cast, 70.7 prev New Home Sales (Mar) 682K vs 0.65M f'cast, 587K prev USA JOLTS Job Openings (Mar) 6.866M vs 6.84M f'cast, 6.882M prev Market Movement Recap 09:04 AM Modestly stronger overnight with bonds following oil prices. 10yr down 1.5bps at 4.422 and MBS up an eighth. 10:08 AM Slightly stronger after 10am data. MBS up 5 ticks (.16) and 10yr down 2.7bps at 4.41 12:14 PM best levels of the day. 10yr down 3.2bps at 4.406 and MBS up a quarter point. 02:42 PM Off best levels. MBS up 5 ticks (.16) and 10yr down 2bps at 4.419 Mortgage News Daily 0 http://www.mortgagenewsdaily.com/rss/mbs https://www.mortgagenewsdaily.com/markets/mbs-morning-05052026 Tue, 05 May 2026 13:37:16 GMT 69fa017ca6791958c5b2289c Matthew Graham After hitting the highest yields in more than a month yesterday, bonds have managed to pick up a few bps. The bulk of the recovery was already in place by yesterday's close, but yields dropped another 2bps after war-related headlines just after 8am (US general said Iran's attacks yesterday were below the threshold for war). Oil prices and bond yields continue the same old correlation.  Coming up at 10am ET, we'll get 2 economic reports that have historically been capable market movers: Job Openings and ISM Services. We've seen some evidence that the market is still willing to react to data if it's far enough from expectations, but that risk is a bit asymmetric at present. Reason being: investors are waiting for economic weakness to show up due to high fuel prices. So it doesn't take as much of an upside surprise in the data to cause bond market weakness. Conversely, if data is slightly weaker than expected, that would be less of a surprise to most investors and thus not as much of a benefit to bonds. Mortgage News Daily 0 http://www.mortgagenewsdaily.com/rss/mbs https://www.mortgagenewsdaily.com/markets/mbs-recap-05042026 Mon, 04 May 2026 20:08:24 GMT 69f90b64a6791958c5b0a241 Matthew Graham Markets Hit by Glut of Escalation Headlines Monday's trading session ended up being as simple as it was unpleasant. Bonds lost ground somewhat sharply as war-related headlines kept adding up to additional escalation. Highlights include overnight reports of Iran hitting a U.S. warship with missiles, multiple reports of UAE air defenses being activated, and damage/fire at a UAE oil export terminal. While bonds had a few moments of independence, they were broadly driven by rising oil prices associated with the aforementioned headlines. Econ Data / Events ISM Manufacturing Employment (Apr) 46.4 vs 49 f'cast, 48.7 prev ISM Manufacturing PMI (Apr) 52.7 vs 53 f'cast, 52.7 prev ISM Mfg Prices Paid (Apr) 84.6 vs 80 f'cast, 78.3 prev Market Movement Recap 09:20 AM moderately weaker overnight. 10yr up 3.5bps at 4.41 and MBS down 7 ticks (.22). 11:31 AM Weakest levels after headlines regarding Iran attacking UAE. MBS down 3/8ths and 10yr up 6bps at 4.435 02:23 PM sideways just off weakest levels. MBS down half a point and 10yr up 7.1bps at 4.447 Mortgage News Daily 0 http://www.mortgagenewsdaily.com/rss/mbs https://www.mortgagenewsdaily.com/markets/mbs-morning-05042026 Mon, 04 May 2026 14:09:16 GMT 69f8b704a6791958c5affb7d Matthew Graham The overnight and early domestic trading hours have brought a mix of familiar and unfamiliar patterns. Up until roughly 8:30am, we saw a very familiar correlation between oil prices and bond yields. Both spiked at 6am following reports that 2 Iranian missiles hit a U.S. warship. Those reports were subsequently denied and oil prices made a full recovery. The unfamiliar pattern involves bonds breaking ranks with oil to move noticeably higher at 9:20am. There are no obvious explanations in the news or on the data calendar. That basically leaves conjecture. Given the timing, one possibility is that traders wanted to free up cash to "play" in equities markets during peak earnings season. This could also be driven by structural shifts in response to budget concerns. Either way, yields are very close to last Wednesday's highs (the highest since March 27th). Mortgage News Daily 0 http://www.mortgagenewsdaily.com/rss/mbs