ADP hit the tape with their pre-employment report estimates this morning expecting job losses of 39K, the largest drop since January (private sector).  Within the data, manufacturing and construction took the biggest hit while the services sector squeaked out a gain of 6K.  ADP also commented that “there is no momentum in employment.”  We shall see come Friday morning.

In other news, the Mortgage Bankers Association reported a rise in purchase activity led by FHA lending (up 9.3%).  Refinances’s decreased 2.5% in the same period.  Bank of America also made headlines, announcing the shutdown of their wholesale lending unit, apparently to focus on consumer direct business.

Going to be tough sledding out there for the brokers.  Stocks have not done much following yesterday’s 200 point gain.  Currently, the Dow is close to unchanged.  Bonds and notes on the other hand have been on fire with the 10 year note up 1 point.  Trouble with this picture is that treasuries are the only thing in stealth rally mode due only to quantitative easing in the air.  Mortgage backs are not doing bad, just not up in lock step with treasuries.

Given the “juice” provided by QE2 (rumor or real), we may be set up for a blow off top and hard reversal.