Market Update
US tsys trading lower, paring earlier losses, 10Y 1.76% (+1.2bps), heavy volume in TY futures mostly due to Dec/Mar roll. Initial risk-on after comments from China Morning Post that US may delay Dec 15th tariffs. S&P futures +3.5 UK gilt yields 3bps higher, UK DMO announced two extra bond auctions for Dec, including a long gilt auction on Dec 5th. Labour also pledged to boost spending by £83bln if they win. GOCs slightly lower, 1bp tighter vs tsys – CGBs bid after weak ADP report (-22k). Poloz to speak in Toronto this morning in a ‘fireside chat’. Deputy Wilkins , in Montreal earlier this week, warned of global headwinds impacting the Canadian economy.
News headlines
U.S. Futures Fluctuate on Trade News; Bonds Drift: Markets Wrap (Bloomberg) U.S. equity futures struggled for traction as investors weighed the latest trade developments, including a bill from Congress supporting Hong Kong protesters that could complicate a deal with China. Stocks fell in Europe and Asia, while Treasuries drifted.
TSX futures edge up as China invites U.S. for fresh round of trade talks (Reuters) Canada’s main stock index futures were slightly up on Thursday, after a report that China had invited top U.S. officials for a new round of face-to-face trade talks boosted sentiment.
Oil Steady as Trade-Deal Concern Offsets Falling U.S. Stockpiles (Bloomberg) Oil steadied after Wednesday’s rally amid concern that political tensions between the U.S. and China pose another hurdle to a trade deal that could lift the global demand outlook.
Trump expected to sign Hong Kong bill despite China threats (BNN) President Donald Trump is expected to sign legislation passed by Congress supporting Hong Kong protesters, setting up a confrontation with China that could imperil a long-awaited trade deal between the world’s two largest economies.
China says it will strive to reach ‘phase one’ trade deal with U.S (Reuters) China will strive to reach an initial trade agreement with the United States as both sides keep communication channels open, the Chinese commerce ministry said on Thursday, in an attempt to allay fears talks might be unraveling.
Exclusive: Trump administration to miss 2019 target for Alaska refuge oil lease sale – official (Reuters) The Trump administration will miss its target of holding the first-ever oil drilling lease sale in Alaska’s Arctic National Wildlife Refuge this year due to delays in the environmental review process, Interior Secretary David Bernhardt told Reuters.
OECD sees global growth at decade-low, blames governments’ indecision (Reuters) The global economy is growing at the slowest pace since the financial crisis as governments leave it to central banks to revive investment, the OECD said on Thursday in an update of its forecasts.
Exclusive: German exports to United States jump despite trade tensions (Reuters) Strong German exports to the United States helped Europe’s largest economy to avoid a recession in the third quarter, data showed on Thursday, as companies benefited from a weaker euro and trade diversion linked to the U.S.-China tariff dispute.
OPEC+ likely to extend oil supply cuts until June: sources (Reuters) OPEC and its allies are likely to extend existing oil output cuts when they meet next month until mid-2020, with non-OPEC oil producer Russia supporting Saudi Arabia’s push for stable oil prices amid the listing of state oil giant Saudi Aramco.
Market Overview: US 10yr note futures are down -0.169% at 129-19, S&P 500 futures are up 0.14% at 3113.25, Crude oil futures are up 0.49% at $57.29, Gold futures are down -0.39% at $1468.4, DXY is down -0.2% at 97.739, CAD/USD is up 0.05% at 0.7513.
| Cda Benchmarks | Yield | Tsy Benchmarks | Yield |
| 2 Year | 1.52% | 2 Year | 1.598% |
| 5 Year | 1.453% | 5 Year | 1.607% |
| 10 Year | 1.443% | 10 Year | 1.759% |
| 30 Year | 1.565% | 30 Year | 2.222% |
US Economic Data
| 08:30 AM | Philadelphia Fed Business Outlook, Nov Survey: 6.0 Prior: 5.6 |
| Initial Jobless Claims, Nov 16 Survey: 218k Prior: 225k | |
| Continuing Claims, Nov 9 Survey: 1683k Prior: 1683k | |
| 09:45 AM | Bloomberg Consumer Comfort, Nov 17 Survey: — Prior: 58.0 |
| Bloomberg Economic Expectations, Nov Survey: — Prior: 49.0 | |
| 10:00 AM | Leading Index, Oct Survey: -0.10% Prior: -0.10% |
| Existing Home Sales, Oct Survey: 5.49m Prior: 5.38m | |
| Existing Home Sales MoM, Oct Survey: 2.00% Prior: -2.20% |
Canadian Economic Data
| 08:30 AM | ADP Canada Releases Oct. Payroll Estimates |
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