Market Update
US tsys weaker on low volume in TY futures (250k), yields 0.5-1bp higher with the 10Y 2.73%, taking their cue from mild risk on tone in Europe, with EGBs underperforming tsys, 10y bund +2bps @ 1.93% – the Euro Stoxx index at a two-month high, while the SPX is above key 63% retracement of the Oct -> Dec decline (2713). Data on tap in the US includes Market Services Index for Jan and the ISM non-man index while the US auctions $38 bln in 3Y notes at 1:00PM. GOCs lower in line with tsys, 10Y 1.97%, some early steepening in 10s30s 1bp wider 24.1bps.
News headlines
Exclusive: Fed could raise rates as much as twice this year – BlackRock’s Rieder (Reuters) The Federal Reserve wants to raise interest rates one to two more times this year and will do so if inflation gathers steam, BlackRock Inc’s Rick Rieder told Reuters this week.
Futures advance, Trump’s State of the Union speech in focus (Reuters) U.S. stock futures posted small gains on Tuesday as investors navigate through the busy earnings season, while waiting for President Donald Trump’s State of the Union address.
Draghi’s long farewell may delay ECB guidance move: sources (Reuters) Some European Central Bank policymakers are reluctant to alter their guidance on interest rates as a move could tie the hands of the bank’s next president many months before an appointment is even made, four sources close to the matter said.
In squeezed oil industry, some rethink hunt for new barrels (Reuters) New partnerships are emerging in the global hunt for oil discoveries, with some explorers essentially offering an outsourcing service for the riskiest part of the energy business.
UK PM May told ministers she wants legally binding changes to Brexit deal (Reuters) Prime Minister Theresa May told her top ministers on Tuesday her objective was to secure legally binding changes to Britain’s EU exit deal to ensure that the country could not be trapped indefinitely in the Northern Irish backstop, her spokesman said.
Slump in Canadian consumer confidence shows no sign of reversing (BNN) A one-year slide in Canadian consumer confidence showed little sign of improving in January, with sentiment levels hovering at depressed levels amid turmoil in financial markets and signs the nation’s economy has hit a soft patch.
Trade hawks quietly bristle as Trump guns for deal with China (BNN) One of Donald Trump’s most persistent economic promises has been to rewrite the U.S. relationship with China. Yet as he approaches a potential deal, some of the very hawks who have cheered on the president’s trade war already fear he may end up falling short.
Iran criticizes Greece, Italy for not buying its oil despite U.S. waivers (Reuters) Iran’s oil minister on Tuesday criticized Greece and Italy for not buying its oil despite U.S. waivers and said they had not offered Tehran any explanation for their decision.
Overnight markets
| Cda Benchmarks | Yield | Tsy Benchmarks | Yield |
| 2 Year | 1.845% | 2 Year | 2.543% |
| 5 Year | 1.88% | 5 Year | 2.545% |
| 10 Year | 1.973% | 10 Year | 2.732% |
| 30 Year | 2.21% | 30 Year | 3.067% |
US Economic Data
| 9:45 AM | Markit US Services PMI, Jan F Surv 54.2 Prior 54.2 |
| Markit US Composite PMI, Jan F Prior 54.5 | |
| 10:00 AM | ISM Non-Manufacturing Index, Jan Surv 57.1 Prior 57.6 |
Canadian Economic Data
There is no Canadian economic data for today.
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