Stocks & Bonds both down. MBS down 2 bps. Stocks down 12 pts

Bonds were almost perfectly flat in the overnight session. 10yr yields and MBS were unchanged ahead of the 8:15am ADP data and made modest gains after that.

ADP Employment: 145k vs 200k f’cast [261k prev]

Leisure / hospitality was the biggest gainer, with 98,000 jobs, while we saw declines in finance and professional / business services. Manufacturing also fell.

The back month was revised higher to 261k vs. the February print of 243k.

Annual pay increased for job stayers by 6.9%, while people who switched jobs saw a 14.2% increase

The two-year yield dropped 8 basis points

ISM Non-Manufacturing: 51.2 vs 54.5 f’cast, 55.1 prev

prices: 59.5 vs 65.6 prev

employment: 51.3 vs 54.0 prev

Yet another report is out this week supporting a shifty narrative for the economy/inflation/rates. ISM Services is in the same league as any of the data we’ve seen so far, or better. As such, it’s no surprise to see bonds responding favorably.

Today’s ISM Services PMI report seemed important but didn’t cause a significant rally in bonds. This wasn’t because the data was unimpressive – it actually showed low inflation rates. However, bond rates had already been increasing for two days due to positive cues from other reports and may not be interested in going higher with uncertainties like the jobs report and CPI looming.

First Republic Bank’s stock price plummeted down but has leveled off since, although the stock is trading at such a discount to book value that there is talk of a buyer coming in, or the government finding one.

Western Alliance Bancorp stock fell 5% in premarket trade Wednesday after the regional bank failed to provide a figure for its deposit balance as of March 31 in its latest financial update.  “Investors are likely to come to the conclusion that management didn’t provide a deposit balance because it’s not good news, which management has been happy to share in the past,” Haire said.

loanDepot Inc. late Tuesday announced a settlement in its proxy fight with Chairman Anthony Hsieh, agreeing to end the fight while also expanding the board of directors by immediately adding Hsieh’s nominee.

In a news release issued Tuesday and a Form 8K filed with the U.S. Securities and Exchange Commission on Wednesday, loanDepot states it has entered into a settlement and cooperation agreement with Hsieh, who in addition to being the company’s founder and chairman of the board is also its largest shareholder, holding approximately 57% of the combined voting power of loanDepot shares.

He was ousted as the company’s executive chairman in February after sending a letter to stockholders announcing his nomination of Williston Financial Group (WFG) CEO Steve Ozonian to the loanDepot board.

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