17/11/2015

cti2015header-morning comments web

Market update

US tsys moving lower after higher core Oct CPI, US 10 curve flatter, US 10Y 2.28 (+1.4bps),tsy 10Y futures in narrow o/n range before CPI, Industrial Production. Euro stocks up a second day, France +2.5%, Greece +3.0% with Greek 10Y -18bps on news of creditor agreement. Core Euro bonds unch – bunds hit a two week high 157.53 before fading as stocks moved higher, 10Y gilt yields 3bps higher as core UK CPI came in above exp. GOCs lower, in line with tsys. Provis opening 0.5bps tighter, focus on CHT 10Y & 5Y FRN supply.

News headlines

  • Europe bounces as Wall St extends rally (FT) European stocks are mirroring a bounce in Asia, shrugging off weakness in base metals as the dollar flirts with 12-year highs in anticipation of a US rate rise in December.
  • Walmart profits dip despite US gains (FT) An improvement at its key US business was not enough to prevent a drop in quarterly profits at Walmart, the Arkansas-based retailer that turned itself into America’s largest.
  • Investors Are Starting to Buy into Oil (WSJ) Investors remain downbeat on oil, but some are starting to buy the companies that pump it out of the ground. Since the beginning of October, Brent, the global oil benchmark, has fallen by 8% and few see it recovering much this or next year. But oil and gas stocks are up almost 8%, as measured by the S&P Global Oil Index.

Overnight markets

  • Overview: IG24 5Y 77.946/78.696 (-0.880), US 10yr note futures are down -0.18% at 126-15, S&P 500 futures are up +0.37% at 2055.5, Crude oil futures are down -0.77% at 41.42$, Gold futures are down -0.23% at $1081.1, DXY is down -0.01% at 99.436.

US Economic Data

  • CPI decrease 0.2% MoM (+0.2% YoY) in October (0.2% MoM and 0.1% YoY Expec) versus September -0.2% MoM (0.0% YoY).
  • CPI core came in at 0.2% MoM (+1.9% YoY) in October (0.2% MoM and 1.9% YoY Expec) compared to previous month 0.2% MoM (1.9% YoY).
  • Industrial production is expected at 0.1% MoM in October compared to September 1.7%.
  • Capacity utilization is forecast at 77.5% in October, equal to previous month.
  • Manufacturing production is expected at 0.2% MoM in October compared to -0.1% in September.
  • NAHB housing market index is forecast at 64.0 in November equal to October.
  • Net long-term TIC flows for September will be release at 16:00.

Canadian Economic Data

  • There is no major economic data 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, Pierre-Olivier Boulanger
Institutional Bond and Equity Desk
CTI Capital Valeurs Mobilières Inc.

Tel : (514)-861-0240
Fax: (514)-861-3230