This is a short week for the markets. With the 4th of July on Wednesday, all markets will be closed that day and volume will likely be lighter on the following days. However, Friday has the monthly jobs report scheduled, so volatility could certainly pop up depending on the jobs figures. Today is starting with stocks lower and mortgage bonds higher due to a lower than expected ISM manufacturing report. The target of 52.2 was missed, with a 49.7 being reported. Anything below 50 signals a contraction, so this adds to the slowing economy argument, and is also the first contraction report since July 2009. mortgagebonds are pushing to their all time highs, so interest rates are pricing out well. We will suggest a locking bias on short term transactions for this short and potentially volatile week.