Market Update
Having previously reached a (fragile) truce on NAFTA and currently appearing to make progress on bilateral trade talks with China, the US now seems to be opening up another front against the EU. The US has been accused of attempting to pressure EU members into opposing the Nord Stream 2 project, while President Donald Trump has stated that European automobile manufacturers are a national security threat. 10-Yr futures continue to trade in a contracting triangle formation with the near term upside focus on the Feb 8 high at 122-15 and the downside focus on the Feb 13 low at 121-21. A bullish break would open the Jan 3 high at 123-08. A break of the triangle base would suggest a run at the 50-dma & Jan 18 low at 121-18/02, below here would enable a run at the Dec 26 low at 120-28.
News headlines
Stocks Mixed as Trade Hopes Fail to Lift Europe: Markets Wrap (Bloomberg) Stocks in Europe and U.S. futures drifted after a rally in Asia boosted shares to their highest level since October on optimism over China’s economy and trade talks. Commodities from oil to copper climbed.
World stocks lifted to 2-1/2 month highs by trade optimism (Reuters) Hopes of progress in Sino-U.S. trade talks and expectations of policy stimulus from central banks lifted world stocks to 2-1/2 month highs on Monday, though European gains were dampened by concerns over the car sector’s outlook.
U.S. agency submits auto tariff probe report to White House (Reuters) The U.S. Commerce Department sent a report on Sunday to U.S. President Donald Trump that could unleash steep tariffs on imported cars and auto parts, provoking a sharp backlash from the industry even before it is unveiled, the agency confirmed.
Brent steadies, set for biggest first-quarter rise since 2011 (Reuters) Brent crude oil steadied on Monday, on track for its strongest first quarter in eight years, thanks to a growing belief among investors that OPEC’s supply cuts will prevent a build-up in unused fuel, though concern over China’s economy offset gains.
Euro gains as U.S.-China trade-talk optimism boosts sentiment (Reuters) The euro rallied and riskier currencies like the Australian dollar strengthened on Monday as optimism over a breakthrough in U.S.-China trade war talks encouraged investors.
European stocks hold onto four-month highs as trade talks progress (Reuters) Fresh from touching their highest level in four months on Friday, European stocks stalled on Monday as investors cashed in their gains ahead of further U.S.-China trade talks in Washington this week.
EU does not see U.S. car imports as national security matter: Germany (Reuters) A spokesman for Germany’s government said it was the European Union’s view that the U.S.’s car imports were not a national security matter, meaning that security could not be a justification for imposing additional tariffs on cars.
Overnight markets
| Cda Benchmarks | Yield | Tsy Benchmarks | Yield |
| 2 Year | 1.778% | 2 Year | 2.514% |
| 5 Year | 1.802% | 5 Year | 2.493% |
| 10 Year | 1.895% | 10 Year | 2.663% |
| 30 Year | 2.152% | 30 Year | 2.994% |
US Economic Data
There is no US economic data for today.
Canadian Economic Data
There is no Canadian economic data for 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, 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