Best Closing Levels in More Than a Week, But Still Generally Flat

Short version: bonds have been basically flat ever since the 2-day sell-off 2 weeks ago that followed Fed Day and stronger econ data on Thursday the 18th. 
Slightly longer version: Bonds were unchanged at the open after closing at higher levels yesterday. ADP came out much weaker than expected, prompting a rally that was immediate, but appropriately sized for ADP (i.e. nowhere near as big as it would have been for NFP). ISM Manufacturing was in line with expectations, which was good enough to end the bond rally for the day. Yields retraced half the ADP-inspired gains by noon, but rallied modestly in the PM hours to end the day at the lowest levels since last Tuesday.

Econ Data / Events

ADP Employment 

-32k vs 50k f’cast
last month revised from 54k to -3k

ISM Manufacturing Employment (Sep)

45.3 vs — f’cast, 43.8 prev

ISM Manufacturing PMI (Sep)

49.1 vs 49 f’cast, 48.7 prev

ISM Mfg Prices Paid (Sep)

61.9 vs 63.2 f’cast, 63.7 prev

Market Movement Recap

08:37 AM Stronger after ADP data.  MBS up 5 ticks (.16) and 10yr down 3.9bps at 4.109

10:16 AM Minimal reaction to ISM data, but off the best levels.  10yr down 3.5bps at 4.113 (up from 4.09 lows).  MBS still up 5 ticks (.16) but down 3 ticks (.09) from highs.

01:23 PM Back near best levels in MBS, up a quarter point on the day. 10yr down 3.6bps at 4.113