Market Update
Tsys trading lower, yields 1-1.5bps higher with the 10Y 2.59%, prices pressured lower in transition to NA trading as S&P futs are now positive thou crude is down for a 5th day 48.30 after falling below 48 earlier. FOMC decision the highlight for the week with rate hike almost a certainty at this point given string of stronger data. GOCs lower underperforming tsys across the curve with the 10Y 1.83% – 2s5s ~1bp steeper as the belly of the curve continues to take brunt of selling pressure. Ontarios better bid on higher GOC yields Friday, 26s lifted at 73.5, unch to start with BC 10Y rumoured (new 2027) with the BC/Ont 26 roll -8/-8.5.
News headlines
Global stocks, dollar up slightly as pivotal week for markets gets underway (Reuters) An event-packed week for global markets got underway on Monday with stocks steady and the dollar recovering from a three-day fall as investors braced for a potential interest rate hike in the United States, a Dutch election and the first G20 finance ministers’ meeting of the Trump era.
Oil touches three-month lows, as U.S. supply swells (Reuters) Oil hovered around three-month lows on Monday, as rising U.S. inventories and drilling activity offset optimism over OPEC’s efforts to restrict crude output. Brent crude LCOc1 was up 4 cents on the day, at $51.41 a barrel by 0953 GMT, having hit a session trough of $50.85, its lowest since Nov. 30.
Dollar steadies after three-day fall (Reuters) Buying from the start of European trade on Monday halted three days of losses for the dollar, the impact of higher U.S. market interest rates turning it positive on the day against both the euro and a basket of currencies.
Surprise fall in Japan January machinery orders raises doubts about recovery (Reuters) Japan’s core machinery orders unexpectedly fell in January from the previous month and dipped the most in five months, adding to worries about whether recent signs of economic recovery will be sustainable.
‘Coal is in decline’ and it looks like not even Donald Trump can pull the industry’s long-term future out of the fire (Financial Post) At their most generous, Las Vegas oddsmakers put the chances of Donald Trump winning the U.S. presidency at 25 to one. In other words, a long shot and one that likely mirrored any potential rebound by the country’s thermal coal miner stocks.
New banks try to carve out a niche the Big Six don’t already dominate in hyper-profitable business (Financial Post) Banking is a fantastic business to be in, if the latest round of earnings by Canada’s Big Six banks is any indication. Each of them beat fiscal first-quarter market expectations, had double-digit profit increases over a year earlier and collectively earned some $10.5 billion in adjusted net income.
Overnight markets
Overview: US 10yr note futures are down -0.038% at 122-31, S&P 500 futures are up 0.01% at 2368.75, Crude oil futures are down -0.33% at $48.33, Gold futures are up 0.11% at $1202.7, DXY is up 0.04% at 101.29, CAD/USD is down -0.07% at 0.7429.
US Economic Data
| 10:00 AM | Labor Market Conditions Index, Feb, est. 2.5 |
Canadian Economic Data
| 10:00 AM | Bloomberg Nanos Confidence, Mar 10, (prior 57.4) |
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
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