Market Update

Tsys off the lows after  weaker Dec Durable Goods & Feb Phili Fed (-4.1 vs 14), yields still  2-3bps higher from o/n session on positive news on trade with Reuters reporting the US & China are close to a trade deal. Fed Bullard , in interview with CNBC, said rates are close to neutral, felt the Fed ‘went too far in Dec’.  Core EGBs lower despite poor German Man. PMI data. GOCs  lower, in line with tsys, 10Y 1.93%.

News headlines

Oil Extends Gains After Muted Increase in U.S. Crude Stockpiles (Bloomberg) Oil extended gains from a three-month high as industry data signaled a limited increase in American crude stockpiles, and on signs that the U.S. and China are moving closer to a trade deal.

TSX futures flat as investors focus on U.S.-China trade talks (Reuters) Futures pointed to a flat opening for Canada’s main stock index on Thursday, as investors await the United States and China to make progress in resolving their trade dispute.

U.S. Stock Futures Drift as Treasury Yields Climb: Markets Wrap (Bloomberg) U.S. equity futures pared a gain, European stocks edged lower and Asian shares rose as investors grappled with a mixed bag of headlines on global trade. Treasuries fell, the greenback was steady and the Aussie dollar slumped.

Exclusive: U.S., China sketch outlines of deal to end trade war – sources (Reuters) The United States and China have started to outline commitments in principle on the stickiest issues in their trade dispute, marking the most significant progress yet toward ending a seven-month trade war, according to sources familiar with the negotiations.

Exclusive: China central bank sees benchmark rate cut as last resort, may use other tools – sources (Reuters) China’s central bank is not yet ready to cut benchmark interest rates to spur the slowing economy, despite cooling inflation and a stronger yuan, which have fanned market expectations of such a move, policy sources told Reuters.

Will the Bank of Canada buck dovish trend? Watch Poloz for clues (Bloomberg) Bank of Canada Governor Stephen Poloz gives his last speech Thursday before next month’s rate decision, with investors looking for indications on whether he will follow the Federal Reserve toward a more dovish tilt on policy.

China expected to propose $30 billion more agriculture imports from U.S.: Bloomberg (Reuters) China is expected to propose spending $30 billion more on U.S. agricultural imports, Bloomberg TV reported on Thursday.

Overnight markets

Cda Benchmarks Yield Tsy Benchmarks Yield
2 Year 1.795% 2 Year 2.516%
5 Year 1.823% 5 Year 2.495%
10 Year 1.925% 10 Year 2.673%
30 Year 2.17% 30 Year 3.018%

US Economic Data

8:30 AM Philadelphia Fed Business Outlook, Feb Surv 14.0 Prior 17.0
  Initial Jobless Claims, Feb 16 Surv 228k Prior 239k
      Continuing Claims, Feb 9 Surv 1743k Prior 1773k
      Durable Goods Orders, Dec P Surv 1.7% Prior 0.7%
      Durables Ex Transportation, Dec P Surv 0.3% Prior -0.4%
      Cap Goods Orders Nondef Ex Air, Dec P Surv 0.2% Prior -0.6%
9:45 AM Bloomberg Consumer Comfort, Feb 17 Prior 60.0
      Markit US Manufacturing PMI, Feb P Surv 54.8 Prior 54.9
      Markit US Services PMI, Feb P Surv 54.3 Prior 54.2
  Markit US Composite PMI, Feb P Prior 54.4
10:00 AM Leading Index, Jan Surv 0.1% Prior -0.1%
      Existing Home Sales,  Jan Surv 5.00m Prior 4.99m
  Existing Home Sales MoM, Jan Surv 0.2% Prior -6.4%

Canadian Economic Data

8:30 AM Wholesale Trade Sales MoM, Dec Surv -0.2% Prior -1.0%

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