Today entrenched the trading range, which is a good thing as they have improved by a solid 50-75bps over previous, and saw the FNMA 3.0 coupon not only hit the ceiling of 101.50 but pierce it for a couple hours before finally closing for the day at 101.469.
Tomorrows news should be interesting as initial claims being higher than expected still shows weakness in the employment market and with manufacturing still a little sluggish I see no signs right now for any major movements (unless some unexpected data is released tomorrow).
I think people are safe floating for now as you may see some minor gains but that is all based on the tolerance for risk and if you have an aversion to it then play the safe game and LOCK pricing is so good you are not making a bad call either way.
Here is today's data...
More Americans filed for unemployment benefits than expected last week with Initial Jobless Claims rising 10K to 277K vs. 267K prior (consensus 271K). The four-week moving average for Jobless Claims fell to 270,750 vs. 271,750 prior. Continuing Claims dropped 53K to 2191K vs. 2244K prior. ISM Manufacturing dropped to 50.20 in September from 51.10 prior for the third consecutive monthly decline; 50.00 is the dividing line between expansion and contraction. Markit US Manufacturing PMI inched 0.10 higher to a final September reading of 53.10 vs. 53.00 in October. Tomorrow we have Nonfarm Payrolls/Unemployment for September and expectations are for 200K vs. 173K prior with no change in unemployment (5.10%). Treasuries are flat this morning following the data release
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