Market Update
Latest headlines China to raise tariffs by 5%-25% on nearly 2,500 US goods spurs bid in Tsys, new highs. Risk assets in retreat while Tsys trading around late overnight highs on moderate volume (TYM>350k), narrow range after initial risk-off bounce as US/China trade angst resumed Sunday (Trump gives China a month to agree on a trade deal, threatens more tariffs; China blames Trump for trade set-backs). VIX rebounds (+2.70, 18.74) still well off last wk 4M highs (23.38); equities weak (ESM9 -39.25, 2847.75) compares to Fri 2826.5L. Slow start for data, week ahead focus is largely on Wednesday with April retail sales, industrial production and capacity utilization and May Empire Manufacturing Index. The 2-Yr yield is down 4.7bps at 2.2191%, 5-Yr is down 4.9bps at 2.2148%, 10-Yr is down 4.1bps at 2.4263%, and 30-Yr is down 2.9bps at 2.8579%.
News headlines
Stocks Slump, Treasuries Up as Trade Clouds Darken: Markets Wrap (Bloomberg) U.S. equity futures slumped and stocks declined across Europe and Asia as investors digested the latest escalation of the global trade war. The yuan tumbled, while Treasuries rallied.
CANADA STOCKS-TSX futures edge lower on trade deal uncertainties (Reuters) Futures for Canada’s main stock index pointed to a lower opening on Monday, as the United States and China appeared to be at a deadlock over trade negotiations.
Oil Rises as Middle East Tanker Attacks Add to Political Risks (Bloomberg) Brent crude oil rallied after Saudi Arabia said two of its tankers were attacked on Sunday, adding to the mounting geopolitical risks in the market.
China says will ‘never surrender’ on trade, Trump warns against retaliation (Reuters) U.S. President Donald Trump on Monday warned Beijing not to retaliate in an escalating trade dispute after China said it “will never surrender to external pressure.”
European shares hit seven-week lows amid U.S.-China trade standoff (Reuters) European shares extended losses early on Monday from the biggest weekly slump this year as the U.S.-China deadlock quelled hopes that the two largest economies will be able to resolve their trade dispute anytime soon.
Futures extend losses after China plans retaliation (Reuters) U.S. stocks futures extended losses on Monday after China said it planned to set import tariffs against $60 billion worth of U.S. goods.
Overnight markets
| Cda Benchmarks | Yield | Tsy Benchmarks | Yield |
| 2 Year | 1.61% | 2 Year | 2.211% |
| 5 Year | 1.58% | 5 Year | 2.207% |
| 10 Year | 1.696% | 10 Year | 2.421% |
| 30 Year | 1.925% | 30 Year | 2.854% |
US Economic Data
There is no US Economic data for today.
Canadian Economic Data
| 10:00 AM | Bloomberg Nanos Confidence, May 10 Survey – Prior 54.9 |
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