Market Update

US tsys weaker on strong ‘risk on’ tone after better than expected China data (exports surged 14.2% in March vs 6.5% exp, +21% in Yuan terms), 10Y 2.54% (+4.7bps), S&P futures +16, crude 64.40 (+0.82), USD index reversing Thursday’s gains, -0.305 96.87. JPM beat Q1 estimates by a wide margin – $2.65 vs $2.35 with revenues rising to a record $29.9bln, while its NIM jumped to the highest in seven yrs at 2.57%. Wells Fargo eps $1.20 vs $1.09, shares up 0.67% pre-mkt.  GOCs weaker, curve another 2bps steeper led by the 10Y, which saw some fairly severe selling yesterday afternoon on the back of 2 blocks of 1500 contracts in CGBs.  Provi spreads ~2bps tighter, Ont 28s 70.5. Ontario 2019 budget neutral for spds, borrowings to decline from $36bln from $39.6bln, with balanced budget forecast by 2024.

News headlines

China March exports rebound to five-month high but imports fall more than expected (Reuters) China’s exports rebounded in March but imports shrank for a fourth straight month and at a sharper pace, painting a mixed picture of the economy as trade talks with the United States reach their endgame.

Stocks Rise, Bonds Drop on China Data; Oil Climbs: Markets Wrap (Bloomberg) Stocks turned higher on Friday and Treasuries slipped with the dollar as credit growth in China and the first major U.S. bank earnings both beat expectations.

TSX futures lifted by rising oil (Reuters) Stock futures pointed to a higher opening for Canada’s main stock index on Friday, as oil prices rose following supply cuts from Venezuela, Libya and Iran.

U.S. EPA to revise proposed freeze of vehicle fuel economy rules (Reuters) The head of the U.S. Environmental Protection Agency said on Thursday the agency would revise its proposed freeze of vehicle fuel economy standards before unveiling its final regulation in the coming months.

Oil Heads for Sixth Weekly Gain Amid Falling OPEC Production (Bloomberg) Oil headed for a sixth weekly increase as falling OPEC production tightened global crude markets, offsetting concerns that slower economic growth will weaken demand.

Futures rise as JPMorgan kicks off earnings season on strong note (Reuters) U.S. stock index futures rose on Friday after JPMorgan kicked off first-quarter earnings season on a strong note, while signs of stabilization in China’s economy helped ease global growth concerns.

Ontario charts five-year path back to balance while avoiding austerity (BNN) Ontario is charting a path back to balance but the Ford government’s inaugural budget will keep voters waiting until after the next election before getting the books in the black.

Overnight markets

Cda Benchmarks Yield Tsy Benchmarks Yield
2 Year 1.624% 2 Year 2.391%
5 Year 1.636% 5 Year 2.363%
10 Year 1.769% 10 Year 2.544%
30 Year 2.054% 30 Year 2.961%

US Economic Data

8:30 AM Teranet/National Bank HPI MoM, Mar Actual -0.3% Prior -0.4%
          Import Price Index MoM, Mar Surv 0.4% Actual 0.6% Prior 0.6%
        Import Price Index YoY, Mar Surv -0.6% Actual 0.0% Prior -1.3%
10:00 AM U. of Mich. Sentiment, Apr P Surv 98.2 Prior 98.4

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