- China shares hit seven-month high; world yields keep falling (Reuters) World shares set up camp at one-year peaks on Monday as a rally in Chinese stocks helped offset news that Japan’s economic growth had ground to a halt in the last quarter, while oil prices extended their latest rally. Wall Street looked set to add fractionally to last week’s string of all-time highs ESc1 [.N] while London .FTSE, Frankfurt .GDAXI and Paris .FCHI were up 0.2-0.4 percent as healthcare and energy stocks kept them buoyant in Europe.
- Japan’s Economic Growth Slows as Business Spending Slumps (Bloomberg) Japan’s economy grew less than forecast in the three months through June 30 as business spending contracted for a second-straight quarter and exporters struggled with the resurgent yen.
- Dollar pinned down by easing Fed rate hike expectations (Reuters) The dollar was softer on Monday, pegged back by sluggish U.S. data that tempered expectations of a Federal Reserve interest rate hike this year. The U.S. currency was 0.3 percent lower at 100.95 yen JPY= after losing 0.6 percent on Friday, when retail sales and producer prices came in weaker than expected. The euro was up 0.15 percent at $1.1172 EUR=, having risen 0.2 percent on Friday. The dollar index was weaker at 95.62 .DXY after dropping to 95.254 on Friday, its lowest since Aug. 3.
- Oil Trades Near Three-Week High on OPEC Freeze Speculation (Bloomberg) Oil traded near the highest closing level in three weeks in New York amid speculation that crude producers will revive talks to stabilize prices. Futures were little changed after earlier gaining as much as 1.5 percent. Prices climbed 6.4 percent last week as Saudi Arabia signaled it’s prepared to discuss stabilizing markets at informal OPEC discussions next month. Russia is open to talks for a joint output freeze “if necessary,” Energy Minister Alexander Novak told Saudi Arabian newspaper Asharq Al-Awsat.
- Russia says oil market talks with Saudi developing – newspaper (Reuters) Russia, the world’s top oil producer, is consulting with Saudi Arabia and other producers to achieve oil market stability, Energy Minister Alexander Novak said, adding that the door is still open for more discussions on freezing output levels if needed. In an interview published on Monday Novak also told Saudi-owned newspaper Asharq al-Awsat that a complete return of market stability is only likely in 2017.
- Nasdaq Tries to Appeal to Investors Lured by New Rival IEX (WSJ) In the latest sign that American stock exchanges are inching away from a decadelong arms race toward ever greater speed, Nasdaq Inc. plans a new option for investors who complain they can’t keep up with rapid-fire trading. The move shows how exchange operators are angling to respond to IEX Group Inc., the startup that won regulatory approval in June to launch a market that slows the pace of trading. Nasdaq and other rivals such as Intercontinental Exchange Inc. opposed the bid from IEX—made famous by the book “Flash Boys,” which maintained that exchanges sold advantages to high-frequency traders—saying its “speed bump” is an artificial barrier that violates rules requiring all orders be immediately accessible to traders.
- Brexit May Be Delayed Until Late 2019, Sunday Times Says (Bloomberg) Britain’s exit from the European Union could be delayed until late 2019 as new departments set up for the transition may not be ready to start negotiations as early as predicted, the Sunday Times reported. The Brexit and international trade ministries are still recruiting staff, making it unlikely Britain will invoke Article 50 –- after which the country has two years to leave the bloc — until late next year, the Sunday Times said, citing people it didn’t name. The potential delay comes amid tensions between International trade secretary Liam Fox and Foreign Minister Boris Johnson over control of certain aspects of policy, according to the Sunday Telegraph.
- Overview: US 10yr note futures are down -0.0707% at 132-14, S&P 500 futures are up 0.24% at 2185.5, Crude oil futures are up 0.54% at $44.73, Gold futures are up 0.02% at $1343.5, DXY is down -0.1% at 95.629.
US Economic Data
- 8:30 AM : Empire Manufacturing, August, est. 2.00, -4.21, (prior 0.55)
- 10:00 AM: NAHB Housing Market Index, August, est. 60 (prior 59.9)
- 16:00 AM: Total Net TIC Flows, June, prior -11.0b
- Net Long-term TIC Flows, June, est. 42.0b (prior 41.1b)
Canadian Economic Data
- 9:00 AM: Existing Home Sales, m/m, July prior -0.9%
- 10:00 AM: Bloomberg Nanos Confidence Index, August 12th, prior 59.9
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, David Leclair-Legault
Institutional Bond and Equity Desk
CTI Capital Valeurs Mobilières Inc.
Tel : (514)-861-0240