cti2015header-morning comments web

Market Update

  • US tsys opening slightly higher, US 10Y 1.55%.  Tsys rose in Asia on the back of dovish FOMC & higher JPY. European stocks moving lower in NA trade giving up earlier gains while S&P futures are lower as well –  Walmart’s Q2 earnings beat having little impact. Initial claims -4k  to 262k in week of August 13th  vs 265k exp. GOCs lower in line with tsys, curve steeper led by the belly. Provis opening unch after closing 0.5bps wider yest – the new CMB 10Y was well received @ 57bps closing 56.5/56.

 News headlines                                                                                 

  • World stocks rise, dollar weakens on divided Fed (Reuters) World stocks rose and the dollar sank to a seven-week low on Thursday after minutes of the U.S. Federal Reserve’s latest meeting showed policymakers were divided over whether to raise interest rates soon. Recent comments from Fed officials suggested a hike in the world’s largest economy could be on the cards as soon as next month, but signs of restraint within the rate-setting committee brought relief to markets, sending global bond yields lower.
  • Oil steady near six-week highs on talk of supply freeze (Reuters) Brent crude oil traded above $50 a barrel for the first time in six weeks on Thursday as the world’s biggest producers prepared to discuss a possible freeze in output levels. Brent hit a high of $50.05 a barrel, up 20 cents on the day, before easing back to around $49.75, down 10 cents, by 1000 GMT. U.S. light crude oil was up 20 cents at $46.99.
  • Japan’s July Exports Drop 14 Percent in Biggest Fall Since 2009 (Bloomberg) Japan’s exports declined the most since 2009, with shipments down for a 10th consecutive month. The continued drop highlights the difficulty of kick-starting growth and pulling Japan’s economy out of the doldrums.
  • Euro zone return to inflation confirmed as food prices surge (Reuters) A modest uptick in euro zone inflation in July was confirmed by data on Friday which showed food prices surging over the year, although overall price indices still fell in 12 of the 19 member states. Euro zone prices rose 0.2 percent year-on-year, Eurostat said, confirming its initial estimate of two weeks ago. Month-on-month, prices fell 0.6 percent from June.
  • Brexit Means Little to British Consumers When the Sun Is Shining (Bloomberg) The U.K. consumer is looking strong for now, shrugging off any Brexit anxiety to enjoy the biggest summer splurge in 14 years. The unexpected 1.4 percent increase in July retail sales reported on Thursday was the best for that month since 2002. It tallies with an industry survey this month showing that warmer weather boosted purchases of summer clothing, food and barbecues. Kingfisher Plc, Europe’s largest home-improvement retailer, said that while the vote to leave the European Union created economic uncertainty, there’s “no clear evidence of an impact on demand.”
  • Aussie Strengthens After July Employment Growth Beats Forecasts (Bloomberg) Australia’s dollar rose after data showed employment growth beat analysts’ forecasts last month. The Aussie climbed 0.3 percent from Wednesday to 76.77 U.S. cents as at 11.32 a.m. in Sydney.
  • Delinquency rates climb in Alberta, Saskatchewan (TheGlobeandMail) Delinquency rates in Alberta and Saskatchewan climbed higher in the second quarter due to the fallout from the drop in the price of oil. Equifax Canada said Thursday the delinquency rate for Alberta stood at 1.4 per cent, up 40.3 per cent compared with a year ago. The delinquency rate in Saskatchewan climbed to 1.2 per cent, a gain of 22.7 per cent.

Overnight markets

  • Overview: US 10yr note futures are up 0.1064% at 132-8, S&P 500 futures are down -0.09% at 2177.75, Crude oil futures are up 0.75% at $47.14, Gold futures are up 0.52% at $1355.8, DXY is down -0.23% at 94.504.

US Economic Data

  • 8:30 AM: Initial Jobless Claims, August 13th, 262k, est. 265k, (prior 266k)
    •      Continuing Claims, August 6th, 2175k, 2142k (prior 2155k)
    •      Philadelphia Fed Business Index, August, 2.0, est. 2.0 (prior -2.9)
  • 10:00 AM: Leading Indicator, July, est. 0.3 (prior 0.3%)

Canadian Economic Data

  • 8:30 AM: Int’l Securities Transactions, June, (prior 14.73b)



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
Fax: (514)-861-3230