Good Thursday AM,

UGH! Yesterday it looked like we would hold above the 50 day moving average which is always a big deal and a catalyst to lower rates. We didn’t sustain it and have gapped down as a result. The 10-yr was at 3.75% yesterday, is now at 3.86% today.

There is no good reason.

When the selling starts, it begets more selling. It started with the overnight markets. They were fairly weak, and then this morning’s data came in and sped up the process. The news was actually pretty bond friendly except jobless claims, but that’s what the market’s kind of reacting to.

Markets were looking for 240k. We got 228k.

That’s a low number however Philly Fed got decimated. We were looking for minus nine. We got minus 13. Existing homes sales missed by a lot (we all know that anecdotally). Basically we have wiped out the last six days of trading which were mostly positive and so, like Sisyphus, we start the climb up the hill yet again.

Not much data tomorrow. Markets are coiling up in advance of next week’s Fed meeting.

Please remain safe and stay healthy!