MARKET WRAP: Mortgage Bonds fell for a 4th straight session on a better than expected reading from the ISM Services, lower Initial Claims, Treasury supply next week and the biggest fear of all, inflation, which has been fueled by rising oil and food prices. The 4% coupon fell 34bp to end the session at 98.09. Stock markets ended on the positive side after trading most of the session near unchanged. But the gains were muted by the looming jobs report that is due to be released tomorrow as traders didn’t look to add any new positions ahead of the release.
9:33 AM ET – Stocks open lower despite the strong ADP data as they look to be somewhat overbought.
8:56 AM ET – MBAs Market Composite Index, a measure of mortgage loan application volume, increased 2.3% in the week ended 12/31.
8:44 AM ET – Stock futures lower but have pared some of those losses after ADP data. ISM Services at 10:00.
8:33 AM ET – ADP Employment number comes in at 297K vs the 100K expected. Bond markets falling.