Rates as of 0500 GMT

Market Recap

The bond market and interest rates continue to dominate the financial markets attention. Following Fridays blowout nonfarm payrolls figure, which showed an increase in jobs nearly twice what was expected 379k vs 200k expected, and thats after a drop in government employment private payrolls were up 465k, the fed funds market is now pricing in nearly a full hike in rates by the end of next year and chances of another by the end of 2023. As a result, 10year US treasuries ended the week up another 16 bps.

Oil was the main story this morning after one of Saudi Arabias major oil facilities came under attack by drones and missiles. The Saudi Energy Ministry said a storage tank in Ras Tanura, Saudi Arabias major export terminal, was attacked by a drone from the sea. Shrapnel from a missile also landed close to a residential compound for employees of Saudi Aramco, the national oil company, in a town close to Ras Tanura. Production appears to have been unaffected though so I question how long this kneejerk reaction will last. The price seems to be starting to come off already. The markets concern seems to be more the frequency of attacks rather than their severity; last week, the villains involved claimed to have hit an Aramco fuel depot elsewhere in the Kingdom. None of the attacks have caused any substantial damage, though.

Its hard to pin down what impact the attack had on sentiment, if any. Stocks in Asia are mixed, with some markets…