ADP reported private jobs in October up 182K slightly less than 185K expected. Sept private jobs were revised lower, frm 200K to 190K. The report in line with forecasts. Prior to the 8:15 release the 10 yr note down 4/32 (12 bp) to 2.22%, the report put a slight support in bonds but so minor it doesn’t make a difference. At 8:30 the 10 yr at 2.20% unchanged frm yesterday and the FNMA 3.5 coupon down 5 bps frm yesterday’s close. Yesterday MBS prices declined 20 bps, the 10 yr increased 2 bps to 2.2% but intraday the 10 traded at 2.22%, cutting through another support level at 2.20% as traders and investors continue their heavy long positions.
Yesterday China’s leaders fessed up that the growth rate next year at 6.5% frm 7.0% they say this year. China faces an aging economy that like the US in a few years will have to deal with a population of older people with less workers driving the engine. Last week it was announced that Chinese couples could now have 2 children, up frm 1 that was put in place decades ago. Japan’s economy has faced aging for years, one reason its economy is not growing as it did in the 80s. The International Monetary Fund, which tends to be more bullish than private economists, projects China’s economy will grow 6.3% next year.
No real movement on the lower outlook as markets already expected China’s growth would continue to slow. The weakening used to bother US investors but since the almighty Fed, the voice of all, noted last week that global slowing would not deter US growth much and not dissuade the Fed from normalizing rates as soon as Dec. Dec still a wild card and depends on Friday’s Oct jobs report and the Nov jobs data on Dec 4th. The FOMC meets again on De 14th and 15th, besides employment data for October and most of November will be in the hands of Fed officials and markets.
The Sept trade deficit reported at -$40.81 in line with forecasts.
At 9:30 the DJIA opened +32, NASDAQ +15, S&P +4. 10 yr note at 9:30 unchanged at 2.21%; FNMA 3.5 coupon unchanged frm yesterday’s close but down 14 bps frm 9:30 yesterday when most lenders set morning prices.
At 10:00 the October ISM services sector index expected at 56.7 frm 56.9; the index was the 2nd best this year at 59.1; new orders increased to 62.0 frm 56.7, employment increased to 59.2 frm 58.6. Prior to the report the mortgage prices were holding small gains, the report pushed prices back t unchanged.
Janet Yellen will testify at the House Financial Services Committee today but unlikely she will have anything to say about the potential of a rate increase in Dec; testimony on regulatory issues. Later this afternoon NY Fed President Wm. Dudley holding a press conference on economic issues, that should get attention.
Slightly better this morning after four days of strong selling of treasuries, but the ISM stopped price improvements. MBS price a little better than when morning prices were set but with employment on Friday and the bearish technical tone now, we want to sit out.
Yesterday China’s leaders fessed up that the growth rate next year at 6.5% frm 7.0% they say this year. China faces an aging economy that like the US in a few years will have to deal with a population of older people with less workers driving the engine. Last week it was announced that Chinese couples could now have 2 children, up frm 1 that was put in place decades ago. Japan’s economy has faced aging for years, one reason its economy is not growing as it did in the 80s. The International Monetary Fund, which tends to be more bullish than private economists, projects China’s economy will grow 6.3% next year.
No real movement on the lower outlook as markets already expected China’s growth would continue to slow. The weakening used to bother US investors but since the almighty Fed, the voice of all, noted last week that global slowing would not deter US growth much and not dissuade the Fed from normalizing rates as soon as Dec. Dec still a wild card and depends on Friday’s Oct jobs report and the Nov jobs data on Dec 4th. The FOMC meets again on De 14th and 15th, besides employment data for October and most of November will be in the hands of Fed officials and markets.
The Sept trade deficit reported at -$40.81 in line with forecasts.
At 9:30 the DJIA opened +32, NASDAQ +15, S&P +4. 10 yr note at 9:30 unchanged at 2.21%; FNMA 3.5 coupon unchanged frm yesterday’s close but down 14 bps frm 9:30 yesterday when most lenders set morning prices.
At 10:00 the October ISM services sector index expected at 56.7 frm 56.9; the index was the 2nd best this year at 59.1; new orders increased to 62.0 frm 56.7, employment increased to 59.2 frm 58.6. Prior to the report the mortgage prices were holding small gains, the report pushed prices back t unchanged.
Janet Yellen will testify at the House Financial Services Committee today but unlikely she will have anything to say about the potential of a rate increase in Dec; testimony on regulatory issues. Later this afternoon NY Fed President Wm. Dudley holding a press conference on economic issues, that should get attention.
Slightly better this morning after four days of strong selling of treasuries, but the ISM stopped price improvements. MBS price a little better than when morning prices were set but with employment on Friday and the bearish technical tone now, we want to sit out.
