Market update

US tsys opening lower & ~1bp steeper, US 10Y 2.17 (+3.7bps).  Tsys pressured by some hawkish comments from Fed governors  Bullard and Williams. Yet as corp supply is expected to pick up significantly this week  (25-30bln after only 10bln last wk) while the US auction 2/5/7 this week with the 5Y at the most expensive on the curve since March 2014. In Canada, GOCs are lower led by 10s (~2bps), 1bp tighter vs tsys with longs outperforming for a second day after Fri saw a good amt of screen buying for cash and against 10s. Corps softer on Fri on rumours of NVCC supply , Hydro One downgrade. CMB new 5Y issue launched, ~48bps.

News headlines

  • The New Bond Market: Bigger, Riskier and More Fragile Than Ever (WSJ) Stocks rise and fall, but bonds are starting to make people anxious no matter what they do.The U.S. bond market is among the biggest financial markets in the world, with $39.5 trillion outstanding at mid-2015, the Securities Industry and Financial Markets Association says.

Overnight markets 

  • Overview: IG25 5Y 81.62/82.06 (+3.588), US 10yr note futures are down -0.24% at 127-21, S&P 500 futures are up +0.46% at 1959.5, Crude oil futures are up +2.48% at 45.79, Gold futures are down -0.49% at $1132.2, DXY is up +0.74% at 95.569.
  • US BANK CDS (5yr): BAC 72/76 (+0), GS 87/91 (+0), MS 78/82 (+0), C 80/84 (+0), JPM 71/75 (+0), WFC 52/56 (+0)

US Economic Data

  • Existing home sales are forecast at 5.5M (-1.6% MoM) in August versus July 5.59M (2.0% MoM).

Canadian Economic Data 

  • Wholesale trade sales came in at 0.0% MoM in July worse than June 1.3% increase and lower than expected (0.8%).
  • Bloomberg Nanos Canadian Confidence Index will be released today at 10:00am.



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, Pierre-Olivier Boulanger
Institutional Bond and Equity Desk
CTI Capital Valeurs Mobilières Inc.

Tel : (514)-861-0240
Fax: (514)-861-3230