Market close

MBS   -13/32 @ 100.19     10 Yr T    -5/32 @ 2.133              DOW  -208 @ 15,115

 

It was an extremely volatile session. Overall, stronger than expected economic data pushed MBS lower. A late decline in stocks helped MBS recover from their worst levels. Chicago PMI manufacturing far exceeded expectations. Consumer Sentiment rose to 84.5, above the consensus of 83.7, and the highest level since July 2007.

Next week, investors will be focused on the labor market data. The ADP forecast for private sector job gains in May will come out on Wednesday. This will be followed by the weekly Jobless Claims report on Thursday. The biggest economic report next week will be the important Employment data on Friday. As usual, this data on the number of jobs, the Unemployment Rate, and wage inflation will be the most highly anticipated economic data of the month, and it will carry even more weight than normal due to how it will influence Fed policy. In addition to the employment data, ISM Manufacturing will be released on Monday, and ISM Services will come out on Wednesday. The Fed's Beige Book will also be released on Wednesday. Construction Spending, the Trade Balance, Productivity, and Factory Orders will round out the busy schedule.