Market Update
US tsys slightly lower on low volume in TY futures, 10Y 1.79%, curve flatter. Equity futures higher, S&P +6.5 and crude up 1.0%. Quiet in core Euro bonds as well, bunds/gilts mixed. Mixed signals on Brexit – EU Juncker saying a deal is possible before Oct 31 while the Irish foreign minister said the gap was still wide between the two parties. GOCs flat before July Retail Sales – 0.6% increase m/m expected driven primarily by rising gas prices (2-3% m/m).
News headlines
U.S. Futures Rise With Europe Stocks; Oil Advances: Markets Wrap (Bloomberg) U.S. equity futures and European stocks climbed on Friday as a busy week of central bank meetings drew to a close, with focus now likely to shift back to the trade war. Treasuries edged higher for a fifth day.
CANADA STOCKS-TSX futures rise on higher oil prices (Reuters) Futures for Canada’s main stock index rose on Friday, as oil prices gained on rising Middle East tensions after a key Saudi Arabian supply hub was knocked out in an attack last weekend.
Oil Set for Biggest Weekly Gain Since January After Saudi Attack (Bloomberg) Oil was on track for its biggest weekly increase since January as traders waited to see whether Saudi Arabia can fulfill promises to swiftly repair a critical processing facility attacked last weekend.
China cuts new loan rate for second month but struggling economy likely needs more (Reuters) China cut its new one-year benchmark lending rate for the second month in a row on Friday, a step by the central bank to try to wrestle down borrowing costs and support the economy as the Sino-U.S. trade war drags on.
BOJ hopes new phrase will keep yen bulls at bay (Reuters) By adding vague new language to its latest policy statement, the Bank of Japan is hoping to keep unwanted sharp gains in the yen in check, without having to tap its depleted policy tool-kit or tying its hands on future monetary action.
Fed’s Bullard, explaining dissent, says U.S. manufacturing appears ‘in recession’ (Reuters) The U.S. manufacturing sector “already appears in recession” and overall economic growth is expected to slow “in the near horizon,” St. Louis Federal Reserve Bank President James Bullard said on Friday, explaining why he dissented at a recent Fed meeting and wanted a deeper, half percentage point rate cut.
Bank of Canada appoints Toni Gravelle as new deputy governor (BNN) The Bank of Canada has appointed Toni Gravelle as its new deputy governor.
Market Overview: US 10yr note futures are down -0.145% at 129-13, S&P 500 futures are up 0.21% at 3014.25, Crude oil futures are up 1.01% at $58.72, Gold futures are up 0.13% at $1508.1, DXY is up 0.18% at 98.446, CAD/USD is up 0.03% at 0.7537.
| Cda Benchmarks | Yield | Tsy Benchmarks | Yield |
| 2 Year | 1.607% | 2 Year | 1.745% |
| 5 Year | 1.466% | 5 Year | 1.664% |
| 10 Year | 1.431% | 10 Year | 1.788% |
| 30 Year | 1.577% | 30 Year | 2.229% |
US Economic Data
| 12:00 PM | Household Change in Net Worth, 2Q Survey: — Prior: $4691b |
Canadian Economic Data
| 08:30 AM | Retail Sales MoM, Jul Survey: 0.60% Prior: 0.00% |
| Retail Sales Ex Auto MoM, Jul Survey: 0.30% Prior: 0.90% |
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