05/04/2017

Market Update

Tsys lower off post ADP  losses – AD P surprised to the upside (263k vs 185k)pointing to a strong non farm,  10Y  2.37% (+1bp), equity futures higher while crude extending gains  51.58(+1.0%) after API crude inventories fell 1.83mln bbls last week. EGBs lower  10Y bund 0.267%  with French yields unch – France’s Le Pen said to have underperformed once again in a TV debate while ECB council member Weidmann advocated removing policy accommodation. GOCs outperforming as tsys rebound, 10Y 1.59%, provis unch after finsihing wider on no supply. Quebec priced its 10Y USD benchmark at MS+ 52.

News headlines 

Stocks Rise as Oil Extends Gain; Data Boosts Pound: Markets Wrap (Bloomberg) European stocks overcame a sluggish start as oil’s advance spurred energy companies, while the dollar and Treasuries steadied before the latest Fed minutes and a meeting between Donald Trump and China’s Xi Jinping. Sterling rose as U.K services grew faster than expected.

EU, Greece urge deal on bailout review on Friday (Reuters) Greece and its lenders must reach a deal on a long-stalled bailout review at a meeting of euro zone finance ministers on Friday, the country’s Prime Minister Alexis Tsipras said on Wednesday, blaming creditors for unwarranted delays.

Trump declares end to ‘war on coal,’ but utilities aren’t listening (Reuters) When President Donald Trump signed an executive order last week to sweep away Obama-era climate change regulations, he said it would end America’s “war on coal”, usher in a new era of energy production and put miners back to work.

EU lawmakers adopt Brexit resolution, reject pro-Gibraltar hint (Reuters) European Union lawmakers adopted a resolution on Wednesday setting their red lines for the two-year divorce talks with Britain and rejected attempts by British MEPs to recognize Gibraltar’s pro-EU stance in the Brexit referendum.

Le Pen Ambushed in French Debate as Macron Attacks on Euro (Bloomberg) Marine Le Pen was labeled soft on her euro exit plans during a television debate performance that failed to win over viewers. The National Front leader’s opposition to the European Union has been a signature issue in the presidential election.

Hudson’s Bay Co posts deep $152 million net loss as it continues to make ‘tough decisions’ (Financial Post) Hudson’s Bay Co. posted a steep fourth quarter loss Tuesday after the retailer reported weak holiday sales and took a $116 million impairment charge related to its ailing off-price business, which includes Saks Off Fifth and online deals retailer Gilt.

Toronto Home Prices Just Jumped Another 33% (Bloomberg) Toronto’s residential housing market showed no signs of cooling last month, with the average sale price soaring a record 33 percent from a year ago, pushing the cost of a detached home in the heart of the city to almost C$1.6 million ($1.2 million).

Overnight markets 

Overview: US 10yr note futures are down -0.112% at 124-29, S&P 500 futures are up 0.18% at 2360.75, Crude oil futures are up 1.23% at $51.66, Gold futures are down -0.59% at $1251, DXY is up 0.01% at 100.55, CAD/USD is down -0.11% at 0.747.

US Economic Data

7:00 AM MBA Mortgage Applications, Mar 31, 1.6% (prior -0.8%)
8:15 AM ADP Employment Change, Mar, 263k, est. 185k (prior 298k)
9:45 AM Markit US Services PMI, Mar F, est. 53.1 (prior 52.9)
Markit US Composite PMI, Mar F,  (prior 53.2)
10:00 AM ISM Non-Manufacturing Composite, Mar, est. 57.0 (prior 57.6)
2:00 PM FOMC Minutes Release From March 14-15 meeting

Canadian Economic Data

There is no major economic news release 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, David Leclair-Legault

Institutional Bond and Equity Desk
CTI Capital Valeurs Mobilières Inc.

Tel : (514)-861-0240
Fax: (514)-861-3230