http://MikesDailyMarketReport.com: Average Earnings rose only 0.3%, coming in under forecasts. Hopefully, this is an indicator that wage inflation is stabilizing. Non-Farm Payrolls reported 428k new jobs for April, beating expectations! However, the Unemployment remained unchanged at 3.6%; likewise, the Average Work Week (hrs.) remained unchanged at 34.6 hours per week. One piece of data that didn't make it onto the graph, was the Labor Participation, which dropped 0.2% to 62.2%. This is something to monitor, as there may be some concerns of another Great Resignation. Both Markets (Stocks and MBS) are reacting similarly. Yesterday, Investors were very concerned over the Labor Cost and Productivity data; and today's data is a little mixed and being treated somewhere in the middle. Investors are thinking that the Fed is behind in the curve with fighting inflation and appear disappointed that the 75bps hike possibility is off the table may only lead to the possibility of stagflation; and feel that a "soft landing" is not possible. The MBS Market is facing a lot of illiquidity, as the gap between Sellers and Buyers continue to widen a bit. MBS is facing a lot of volatility today, as they're currently Down 30bps, which is off from earlier lows. Either way, Mortgage Rates have worsened by at least a .125% to the rate. Meanwhile, Yields continue to rise, as they are now at 3.12%.
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