Market Update

Choppy trade by the open, long end rebounds to mildly higher after recent Block sale of -14k TYU 126-00 helped push entire curve to session lows. Some desks report better buying on net. Flow included Asian real$ buying in the short end, Asian real$ selling in the intermediates, credit acct buying out the curve, light fx-tied sales as USD inches higher,deal-tied flow in the mix w/potential large supply from BAT and AAPL, see 0804ET bullet.

News headlines 

Euro Shrugs Off German Data to Bounce; Crude Drops: Markets Wrap (Bloomberg) The euro resumed gains against the dollar even as data showed German industrial production unexpectedly fell in June. Crude dropped as OPEC nations met with their allies.

Oil slides from nine-week highs as market looks to OPEC (Reuters) Oil prices edged lower on Monday, sliding away from nine-week highs, as worries lingered over high production from OPEC and the United States. Global benchmark Brent crude futures LCOc1 were down 60 cents, or 1.14 percent, at $51.82 a barrel at 1113 GMT. They traded as low as $51.56 a barrel earlier in the day.

U.K. Economy Takes a Hit as Consumer Spending Slumps Further (Bloomberg) U.K. consumers cut back on spending for a third month in July as house-price growth slowed sharply, dealing yet another blow to the economy. The broad-based weakness is being blamed on a squeeze on pockets as inflation outpaces wage growth as well as concerns about the health of the economy.

Brexit negotiations have not begun well for UK, says former top diplomat (Reuters) Britain’s negotiations over leaving the European Union have not begun well due to disagreements among Prime Minister Theresa May’s team of ministers about the kind of deal they should be seeking, a former top British diplomat said.

German industrial output drops in June, up in second quarter (Reuters) German industrial production unexpectedly fell for the first time this year in June, data showed on Monday, though it increased in the second quarter overall. Output declined by 1.1 percent on the month after rising 1.2 percent in May, the Economy Ministry data showed. Expectations in a Reuters poll were for a 0.2 percent gain.

Swiss exporters cheer as more franc weakness on cards (Reuters) Swiss exporters may carry on benefiting from a relatively weak Swiss franc for some time, with economic, monetary and technical factors all suggesting the currency’s descent against the euro has further to run.

Overnight markets 

Overview: US 10yr note futures are down -0.012% at 126-02, S&P 500 futures are up 0.09% at 2474.25, Crude oil futures are down -1.15% at $49.01, Gold futures are down -0.17% at $1262.5, DXY is down -0.11% at 93.44, CAD/USD is up 0.23% at 0.7887.

Cda Benchmarks Yield Tsy Benchmarks Yield
2 Year 1.243% 2 Year 1.359%
5 Year 1.537% 5 Year 1.826%
10 Year 1.921% 10 Year 2.269%
30 Year 2.351% 30 Year 2.842%

US Economic Data 

3:00 PM Consumer Credit, Jun, est. $15.250b (prior $18.410b)

 Canadian Economic Data

There is no major 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, David Leclair-Legault

Institutional Bond and Equity Desk
CTI Capital Valeurs Mobilières Inc.

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