Wednesday Close

Bonds bounced modestly off their lows, but nothing to get real excited about. 10-year rallied 1/8 off its intra-day low, 30-year up 10 ticks. FF futures show all but a lock for 5.50% at the next meeting. The rally at the end of June was now pretty clearly just quarter-end window dressing. If the Fed is going to 5.50%, can you buy the 10-year south of 5.25%?

Jobless claims tomorrow. The market is going to look to both initial and continuing to see if there is anything to the ADP estimate. If we get strong numbers, market will probably price in a blowout NFP number on Friday. I think something in the mid-200,000 range is already priced in. Throw out the Bloomberg survey or whatever else you look at as a gauge for what qualifies as a miss, particularly if there is another sell-off tomorrow.