08 Nov Surprise! Jobs report was better than expectations
Surprise! The jobs report beat expectations of 120,000 by coming in at 204,000. In addition, the previous 2 months were revised by 60,000 higher. The headline number caused a premarket sell-off in stocks and bonds, as fears of QE tapering were back on the table. Stocks bounced back at the open, but bonds are still well underwater, with mortgage bonds dropping like a rock off of the 200 day moving average. This move results in interest rates moving higher by 1/8% to ¼%. Bond prices are currently sitting on the 50 day moving average, and it would be a somewhat positive sign for interest rates if prices hold at this level. After yesterday’s suggested locking bias, we can start new transactions with a floating stance for now.