Market Update
US tsys continuing higher, adding to Wed post FOMC rally, on moderate futures volume (327k TY1), US 10Y 2.51% (-2bps), off the highs after March Phili Fed (13.7 vs 4.8exp). EGBS higher, in catchup mode from yest FOMC. UK gilt yields 5-8bps lower, BOE left rates on hold as exp saying that rates could move in either direction. GOCs higher, in line with tsys, 10Y 1.635% a 21 month low – 10s looking very expensive on the curve on a 3 month basis ( 3 stds vs 2s/30s). The BOC auctions $3.0bln in 2Y bonds , reopening the 1.75% May 21 issue which will take it to $9.0bln outstanding, the May 21/Feb 21 roll -0.1/-0.4. Quebec budget later this aft.
News headlines
Bonds Rally, Dollar Rebounds as Fed Spurs Caution: Markets Wrap (Bloomberg) Government bond yields retreated while U.S. equity futures and European stocks fell on Thursday as investors digested a dovish lurch by policy makers in the world’s largest economy. The dollar rebounded after Wednesday’s loss.
Fed sees no 2019 hikes, plans September end to asset drawdown (BNN) Federal Reserve officials scaled back their projected interest-rate increases this year to zero and said they would end the drawdown of the central bank’s bond holdings in September after holding policy steady on Wednesday.
‘Opportunity missed’: What these analysts hoped to see in the federal budget but didn’t (BNN) The federal budget, largely seen as a pre-election document, introduced measures on Tuesday that targeted a number of different groups. From support for debt-burdened students and worried retirees, to help for first-time homebuyers, the budget was wide-reaching.
Trump says tariffs will stay on until China complies with a deal (BNN) President Donald Trump said Wednesday he’ll keep tariffs on China until he is sure Beijing is complying with any trade deal the two nations reach.
SNC-Lavalin Chief Says Job Losses Possible Amid Canadian Scandal (Bloomberg) The head of the Montreal-based construction giant at the center of a political firestorm warned the company remains undervalued, is vulnerable to a takeover and at risk of shedding jobs in Canada.
PRECIOUS-Gold hits 3-week high as Fed stalls 2019 rate hikes; palladium scales new peak (Reuters) Gold prices rose to a three-week high on Thursday, after the U.S. Federal Reserve abandoned plans to raise interest rates for the year, while a cut in its U.S. growth forecast exacerbated worries of a global economic slowdown.
Oil Holds Near $60 as U.S. Stockpiles Plunge, Saudis Cut Supply (Bloomberg) Oil held near a four-month high after U.S. crude inventories plunged by the most since July, while Saudi Arabia pressed on with export cuts.
PRECIOUS-Gold hits 3-week high as Fed stalls 2019 rate hikes; palladium scales new peak (Reuters) Gold prices rose to a three-week high on Thursday, after the U.S. Federal Reserve abandoned plans to raise interest rates for the year, while a cut in its U.S. growth forecast exacerbated worries of a global economic slowdown.
Overnight markets
| Cda Benchmarks | Yield | Tsy Benchmarks | Yield |
| 2 Year | 1.578% | 2 Year | 2.384% |
| 5 Year | 1.524% | 5 Year | 2.304% |
| 10 Year | 1.642% | 10 Year | 2.505% |
| 30 Year | 1.965% | 30 Year | 2.957% |
US Economic Data
| 8:30 AM | Philadelphia Fed Business Outlook, Mar Surv 4.8 Actual 13.7 Prior -4.1 |
| Initial Jobless Claims, Mar 16 Surv 225k Actual 221k Prior 229k Revised 230k | |
| Continuing Claims, Mar 9 Surv 1770k Actual 1750k Prior 1776k Revised 1777k | |
| 9:45 AM | Bloomberg Consumer Comfort, Mar 17 Prior 60.8 |
| Bloomberg Economic Expectations, Mar Prior 54.5 | |
| 10:00 AM | Leading Index, Feb Surv 0.1% Prior -0.1% |
Canadian Economic Data
| 8:30 AM | Wholesale Trade Sales MoM, Jan Surv 0.6% Actual 0.6% Prior 0.3% |
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