Friday - December 6, 2013, 10:20am ET

Current Trend Direction: Lower

Float/Lock Bias:FloatingCurrent Price of FNMA 4.0% Bond: $103.50, +9bp

The highly anticipated November Jobs Report was released this morning revealing that employers created 203K job last month, above the 188K expected. The Unemployment Rate fell to a 5-year low of 7% while the Labor Force Participation Rate managed to tick up to 63.0% from 62.8%, though still at lows not seen since the late '70s.

The news pushed the Bond markets considerably lower, but they have recovered back to unchanged to modestly higher as buyers rushed in at the low levels scooping up bargains along with traders covering short sale bets.

Rounding out the report, the Average work remained at 34.5 hours while the Hourly Earnings Rate ticked up to 0.2% from 0.1%.

In less groundbreaking news, Personal Incomes in October slipped to -0.1% from 0.5% and below the 0.3% expected while Personal Spending was in-line at 0.3% and up from 0.2% from the previous month. On the inflation front, Core PCE for October remained at 0.1% while the year-over-year is at 1.1%, well below the Fed's target high end of 2%.

The closely watched 10-Year yield did hit 2.93% this morning before settling down to 2.86% as prices improved. We don't think we will see a 3% handle on the 10-Year Note just yetbut should the yield bust above that psychological level, Mortgage Bonds will likely move lower as well.

With the Jobs Report behind us and several lock alerts this week and the switch to locking on Tuesday, we will start the day Floating any new files. We still don't see the Fed tapering after the December 18 meeting and before Janet Yellen takes over as Fed Chief. QE will live on through this year with the Fed closely watching upcoming key economic data for further confirmation that the U.S. economy has turned the corner for greener pastures.

Have a great weekend!

Joe Shamie NMLS # 241432

First Choice Loan Services NMLS # 210764

First Choice Bank NMLS# 177877

866-970-3400 x-5135

jshamie@fcbmtg.com