Market Update
US tsys lower, yields 2-2.5bps higher, 10Y 2.735%, above avg volume in TY futures (470k). German bunds lower as well, 10Y bund 0.20%. European stocks at the highest in five months, Euro Stoxx third straight weekly gain despite weaker Feb Eurozone PMI (62 vs 52.6 in Jan). US Equity futures higher, S&P +17, Nasdaq +51 – Ebay +3.4% announcing a strategic review, GAP +5% as it looks to spin off Old Navy. Focus on ISM Man., PCE & U. Michigan sentiment. GOCs lower before Q4 GDP – expected at 1.0% vs 2.0% Q3.
News headlines
Stocks Climb as China Lifts Spirits; Dollar Gains: Markets Wrap (Bloomberg) Stocks are ending the week on a positive note as the latest economic data from China offers reassurance to investors concerned about the global growth outlook, while prospects of a trade deal improved. Treasuries extended a decline and the dollar pushed higher for a third day.
Wall Street futures bounce as focus shifts to inflation, factory data (Reuters) U.S. stock index futures bounced on Friday, setting up Wall Street’s main indexes for gains at the open, with investors waiting for data on inflation and manufacturing activity.
Deepening downdraft chills factory activity (Reuters) Factories across the globe slammed on the brakes last month as demand crashed, hit by the ongoing U.S.-China trade war, slowing global growth and political uncertainty in Europe ahead of Britain’s imminent departure from the EU.
Euro zone’s triple-A bond drought persists after ECB steps away (Reuters) High-grade euro zone debt remains scarce even though the European Central Bank has stopped its huge purchases of new bonds, intensifying concerns that banks will face future collateral shortages and highlighting the need for safe assets.
No deal blow for Moon’s vision of ‘peace-driven’ Korean economy (Reuters) As word spread that a summit between U.S. President Donald Trump and North Korean leader Kim Jong Un was ending early in failure, some South Korean officials at a Hanoi media center watching a live feed of proceedings turned pale and made hurried calls.
Canada seen approving extradition hearing against Huawei executive (Reuters) Canada is likely to announce on Friday that an extradition hearing against a Huawei Technologies Co Ltd executive can proceed, legal experts said, worsening already icy relations with Beijing.
Alberta eases oil output curtailment as prices rise, glut wanes (BNN) Alberta increased the amount of crude its letting producers pump for a second time after local oil prices surged and inventories continued to decline.
U.S. said to ready final China trade deal as hawks urge caution (BNN) U.S. officials are preparing a final trade deal that President Donald Trump and his Chinese counterpart Xi Jinping could sign in weeks, people familiar with the matter said, even as a debate continues in Washington over whether to push Beijing for more concessions.
Underlying Inflation Weakens as ECB Prepares for Crucial Meeting (Bloomberg) Underlying price pressures in the euro area remain weak, according to the latest inflation figures for the region, giving European Central Bank policy makers more to digest ahead of their crucial meeting next week.
Overnight markets
| Cda Benchmarks | Yield | Tsy Benchmarks | Yield |
| 2 Year | 1.791% | 2 Year | 2.532% |
| 5 Year | 1.836% | 5 Year | 2.538% |
| 10 Year | 1.962% | 10 Year | 2.739% |
| 30 Year | 2.207% | 30 Year | 3.105% |
US Economic Data
| 8:30 AM | Personal Income, Jan Surv 0.3% |
| Personal Spending, Dec Surv -0.3% Prior 0.4% | |
| Real Personal Spending, Dec Surv -0.3% Prior 0.3% | |
| PCE Deflator YoY, Dec Surv 1.7% Prior 1.8% | |
| PCE Core MoM, Dec Surv 0.2% Prior 0.1% | |
| PCE Core YoY, Dec Surv 1.9% Prior 1.9% | |
| 9:45 AM | Markit US Manufacturing PMI, Feb F Surv 53.7 Prior 53.7 |
| 10:00 AM | ISM Manufacturing, Feb Surv 55.8 Prior 56.6 |
| ISM Prices Paid, Feb Surv 51.8 Prior 49.6 | |
| U. of Mich. Sentiment, Feb F Surv 95.9 Prior 95.5 |
Canadian Economic Data
| 8:30 AM | Quarterly GDP Annualized, 4Q Surv 1.0% Actual 0.4% Prior 2.0% |
| GDP MoM, Dec Surv 0.0% Actual -0.1%Prior -0.1% | |
| GDP YoY, Dec Surv 1.4% Actual 1.1% Prior 1.7% | |
| Markit Canada Manufacturing PMI, Feb Prior 53.0 |
Disclosure and Disclaimer
The following sources of information have been, or may have been, used partially or in their entirety to compile the herein provided CTI Capital Securities Inc. (“CTI Capital”) ‘Morning Comments.’ CTI Capital believes these sources to be generally reliable, however, as said sources are varied and from third parties, CTI Capital cannot guarantee the accuracy or completeness of said information: Canadian Press (CP); Bloomberg News (BN); Wall Street Journal (WSJ); Stone & McCarthy Research Associates (SMRA); New York Times (NYT); Financial Times (FT); Market News International (MNI); Globe and Mail; Associated Press (AP); CNW Group (CNW); Reuters; Business News Network (BNN); Market Watch; and others.
Ivan Greenstein, Stephan Buu, Émile Bordeleau
Institutional Bond and Equity Desk
CTI Capital Valeurs Mobilières Inc.
Tel : (514)-861-0240
Fax: (514)-861-3230
Institutional Bond and Equity Desk
CTI Capital Valeurs Mobilieres Inc.
Tel : (514)-861-0240
Fax: (514)-861-3230