Market Update

US tsys slightly lower, 10Y 2.38%, tsy curve 2bps flatter, TY futures lower end of overnight range on above avg volume (450k), of note the 3M-10Y curve is inverted -1.8bps. Equity futures slightly higher, (S&P +0.25%) . April Housing starts & May Phili Fed highlight US macro data. After yesterday’s big moves, core EGBs stable, 10Y bund yield 0.5bps lower, Italy tighter. GOCs unch before March Man Sales/April ADP as well as the BOC’s Financial System Review.  Provis traded well yest on the back of the QC 51 deal @ 79 (77/76) and positive risk-on sentiment. 

News headlines

U.S. Stock Futures Turn Higher, Treasuries Decline: Markets Wrap (Bloomberg) U.S. equity futures turned higher on Thursday and Treasuries reversed a gain as trade headlines continued to whipsaw global markets. Stocks in Europe also rose, while most of the region’s sovereign bonds held their advance.

TSX futures up on higher oil prices (Reuters) Stock futures pointed to a higher opening for Canada’s main stock index on Thursday, boosted by rising oil prices.

China slams U.S. blacklisting of Huawei as trade tensions rise (Reuters) China on Thursday slammed a decision by the U.S. government to put telecom equipment giant Huawei on a blacklist and said it will take steps to protect its companies, in a further test of ties as the economic heavyweights clash over trade.

Oil Climbs on Falling U.S. Gasoline Stockpiles and Gulf Tension (Bloomberg) Oil climbed for a third day — the longest run of gains in three weeks — as falling U.S. gasoline stockpiles supported the demand outlook and simmering tensions in the Middle East kept investors on edge.

EU goods surplus with U.S. eases, deficit with China widens (Reuters) The European Union’s trade surplus in goods with the United States decreased in the first three months of 2019, but its deficit with China widened, figures released on Thursday showed.

Iraq has contingency plans in case Iran gas imports halted: minister (Reuters) Iraq has contingency plans for any stoppage to Iranian gas imports for its power grid but hopes no such disruption will take place, Oil Minister Thamer Ghadhban said on Thursday.

Exclusive: Trump EPA did not await court ruling to loosen biofuel rules for refiners – documents (Reuters) The Trump administration made it easier for oil refineries to get waivers from the nation’s biofuel law at least four months before a 2017 court decision it often cites to justify the move to the corn lobby, and the move was motivated by a desire to save the oil industry money, Reuters has learned.

Overnight markets

Cda Benchmarks Yield Tsy Benchmarks Yield
2 Year 1.588% 2 Year 2.18%
5 Year 1.543% 5 Year 2.163%
10 Year 1.664% 10 Year 2.38%
30 Year 1.901% 30 Year 2.822%

US Economic Data

08:30 AM Housing Starts, Apr Survey 1209k Prior 1139k
     Housing Starts MoM, Apr Survey 6.20% Prior -0.30%
     Building Permits, Apr Survey 1289k Prior 1269k
     Building Permits MoM, Apr Survey 0.10% Prior -1.70%
     Philadelphia Fed Business Outlook, May Survey 9.0 Prior 8.5
     Initial Jobless Claims, May 11 Survey 220k Prior 228k
     Continuing Claims, May 4 Survey 1673k Prior 1684k
09:45 AM Bloomberg Consumer Comfort, May 12 Survey — Prior 59.8

Canadian Economic Data

08:30 AM Int’l Securities Transactions, Mar Survey — Prior 12.05b
     Manufacturing Sales MoM, Mar Survey 1.50% Prior -0.20%

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