Market Update
US tsys reversing course, rising sharply on news China will impose retaliatory tariffs on $75bln of US goods, 25% tariffs on autos from Dec 15th, US 10Y 1.61%. Fed Bullard sounding dovish, noting the inverted yield curve signals the Fed should be lowering rates, expects debate on 50bp rate cut in Sept. Focus on Jackson Hole & Powell speech at 10:00am. GOCs unch before June Retail Sales (-0.3% exp, core unch). HQ 2055 tap yesterday adding to upward move in spds, steepening at the long end of the GOC curve. Provi spds opening unch.
News headlines
Stock futures turn sharply lower after China threatens tariffs on U.S. goods (Reuters) U.S. stocks futures fell sharply on Friday after China said it would impose tariffs on about $75 billion worth of U.S. goods.
Seeking clarity from Fed’s Powell? Good luck with that (Reuters) When Federal Reserve Chair Jerome Powell speaks in Jackson Hole, Wyoming, on Friday, traders will comb through his remarks for clues on whether the U.S. central bank will deliver more rate cuts this year.
China to soon unveil plan for retaliatory tariffs on some U.S. products: Global Times (Reuters) China will soon unveil a plan to impose retaliatory tariffs on certain U.S. products, the editor in chief of China’s Global Times newspaper said.
Oil Heads for Second Weekly Increase Before Fed Chair’s Speech (Bloomberg) Oil headed for a second weekly gain as traders awaited guidance from the Federal Reserve on whether the U.S. will ease monetary policy to shore up economic growth.
This time isn’t different, says the Prof who first linked inverted yield curve with recession (BNN) The professor who first identified the yield curve inversion as a reliable indicator of a looming recession has a simple message for anyone arguing that this time is different: Don’t.
Cold, hard euros: Venezuela turns to European cash after U.S. sanctions (Reuters) From supermarket checkouts in the capital Caracas to electronics stores in the central city of Maracay, Venezuelans struggling with hyperinflation and a deep economic crisis are turning to a new form of payment: euros in cash.
Fed’s Bullard says Fed should continue to ease monetary policy: CNBC (Reuters) The U.S. Federal Reserve should continue to ease monetary policy because of the Treasury yield curve, which recently inverted again, St. Louis Federal Reserve President James Bullard said on Friday.
Market Overview: US 10yr note futures are down 0% at 130-10, S&P 500 futures are down -0.31% at 2913.25, Crude oil futures are down -0.27% at $55.2, Gold futures are up 0.23% at $1511.9, DXY is up 0.25% at 98.417, CAD/USD is up 0.13% at 0.7507.
| Cda Benchmarks | Yield | Tsy Benchmarks | Yield |
| 2 Year | 1.468% | 2 Year | 1.597% |
| 5 Year | 1.329% | 5 Year | 1.489% |
| 10 Year | 1.292% | 10 Year | 1.61% |
| 30 Year | 1.525% | 30 Year | 2.11% |
US Economic Data
| 10:00 AM | New Home Sales, Jul Survey: 647k Prior: 646k |
| New Home Sales MoM, Jul Survey: 0.20% Prior: 7.00% |
Canadian Economic Data
| 08:30 AM | Retail Sales MoM, Jun Survey: -0.30% Prior: -0.10% |
| Retail Sales Ex Auto MoM, Jun Survey: 0.00% Prior: -0.30% |
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