Some Volatility Surrounding Headlines, But Not Much Change
Bonds began the day roughly flat before losing ground modestly into the 9am hour as markets mis-read headlines regarding new peace proposals submitted by Iran. But just before 10am, similar headlines resurfaced including the claim that Iran's new proposal made concessions regarding Iran's nuclear aspirations. This accounted for a swift move into positive territory that was only partially reversed after Trump said he wasn't satisfied with the latest proposal despite acknowledging progress in the peace talks. The net effect is a bond market that is roughly unchanged heading into the 3pm CME close. As has been the case, any major progress toward peace over the weekend (or any major escalation) could result in trading levels being drastically different on Monday morning.
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
09:00 AM Modestly weaker overnight. MBS down an eighth and 10yr up 2bps at 4.39
10:05 AM Rallying after ISM data. MBS back near unchanged levels and 10yr down half a bp at 4.364
10:54 AM Giving up roughly half the gains now. MBS down 2 ticks (.06) and 10yr just a hair over unchanged at 4.373
02:29 PM Flat in the PM hours so far. MBS down 3 ticks (.09) and 10yr up less than 1bp at 4.379
Mortgage Rates End Week on a Calm Note
Low volatility was the most obvious theme for mortgage rates last week. From April 14th through last Friday, the range for a top-tier 30yr fixed rate remained in an ultra-narrow range of 6.29-6.33%. That trend persisted on Monday of this week, but thin…