Market Update

GOCs trading higher in reaction to much weaker Sep retail sales (0.1% vs 1% exp, core 0.3% vs 1.0% exp) after a quiet overnite session, with the US & Japan mkts closed for holidays.  Euro equities slightly higher, core EGBs mixed –  gilts higher on softer UK service data and dovish FOMC minutes yest, bunds slightly lower on stronger data , also it appears the opposition is ready to talk to Merkel on forming a minority govt.  Provis closed another 0.5bps tighter yest on  top of the 2bps Tuesday – we are heading into a period of lower supply while the extension in the provi index in early Dec should be supportive of spreads..The OECD issued a warning on Canada’s high debt levels as part of a report to be released next week.

News headlines 

Merkel Offered Path to Fourth Term as Resistance Begins to Fray (Bloomberg) Germany’s biggest opposition party is ready to begin talks with Angela Merkel on a minority government, offering her a way to restore political leadership in Europe’s biggest economy.

OECD Warns on Rising Debt Risk as Canadians Most in the Red (Bloomberg) The OECD warned that rising private debt loads in both advanced and developing economies pose a risk to growth as Canada, South Korea and the U.K. lead the world in household borrowing.

U.K. Faces Longest Fall in Living Standards Since Records Began (Bloomberg) Britons were warned they are on course for the longest fall in living standards since records began 60 years ago after the U.K.’s fiscal watchdog took the ax to its outlook for economic growth.

European Stocks Erase Losses; Dollar Extends Drop: Markets Wrap (Bloomberg) European stocks erased early losses as positive economic data in the region offset negative sentiment following a slump in Chinese equities. The dollar extended a retreat, but at a slower pace than in the wake of Wednesday’s more dovish than expected Federal Reserve minutes.

Canadian CEOs Urge Trudeau to Back TPP (Bloomberg) Canadian chief executives are calling on Prime Minister Justin Trudeau to nail down and implement an 11-nation Pacific Rim trade deal, as Canada holds out in hopes of changes.

$15 minimum wage, emergency leave become law as Ontario passes labour reform legislation (CBC) Ontario passed sweeping labour reform legislation Wednesday, including increasing the minimum wage to $15 an hour, which will form a key pillar of the governing Liberals’ re-election bid next year.

TSX futures flat ahead of retail sales data (Reuters) Stock futures pointed to a flat opening for Canada’s main stock index on Thursday as investors awaited a report on the country’s retail sales. Statistics Canada will release retail sales data for September, which a poll of economists said is likely to have rebounded to 0.9 percent from a 0.3 percent fall in the previous month.

Uber’s messy data breach collides with launch of SoftBank deal (Reuters) A newspaper advertisement for an Uber Technologies Inc stock sale was juxtaposed on Wednesday with a report that the ride-service provider had covered up a data hack – something of a metaphor for Uber, a company with boundless investor interest, but whose penchant for rule-breaking has led to a series of scandals.

Overnight markets

Overview: US 10yr note futures are down -0.05% at 125-02, S&P 500 futures are up 0.08% at 2596.5, Crude oil futures are down -0.12% at $57.95, Gold futures are down 0% at $1296.8, DXY is down -0.12% at 93.111, CAD/USD is down -0.06% at 0.7881. 

Cda Benchmarks Yield Tsy Benchmarks Yield
2 Year 1.459% 2 Year 1.727%
5 Year 1.65% 5 Year 2.042%
10 Year 1.911% 10 Year 2.319%
30 Year 2.254% 30 Year 2.739%

US Economic Data

There is no US Economic Data for today.

Canadian Economic Data

8:30 AM Retail Sales MoM, Sep 0.1% est 1.0% (-0.3% prior)
  Retail Sales Ex Auto MoM, Sep 0.3% est 1.0% (-0.7% prior)


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, Hugues Savard

Institutional Bond and Equity Desk
CTI Capital Valeurs Mobilières Inc.

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