Some Volatility Surrounding Headlines, But Not Much Change

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
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