Market Update
US tsys trading lower, yields 2-2.5bps higher, 10Y 2.68% (+2.5bps), roll from March to June responsible for volume in TY futures (590k). S&P futures higher, emini above 2,800 for first time since Dec 3rd. Trump said he would extend the tariff deadline on Chinese goods beyond march 1st, China CSI comp +6%. GE trading 18% higher pre-mkt on news it will sell its Biotech business to Danaher for $21bln, proceeds will be used to reduce debt. Prelim estimate for Bloomberg-Barclays US month end extension 0.12yrs same as last yr and one yr avg of 0.08. The US auctions $40bln in 2Y notes at 11:30 and $41bln in 5Y notes at 1:00 ET. GOCs lower, lagging the decline in tsys by ~0.5bps, 10Y 1.91% – volatility in the 10Y part of the curve (based on bollinger band width) at the lows since last Sept. Jan CPI on Wednesday, Q4 GDP Friday highlights for the week, the latter expected at 1.0% vs 2.0% Q3.
News headlines
Trump delays tariff hike on Chinese goods, citing trade talk progress (Reuters) President Donald Trump said on Sunday he would delay an increase in U.S. tariffs on Chinese goods thanks to “productive” trade talks and that he and Chinese President Xi Jinping would meet to seal a deal if progress continued.
Stocks Climb as China Soars on Optimism Over Trade: Markets Wrap (Bloomberg) U.S. equity futures advanced alongside stocks in Europe and Asia after President Donald Trump postponed the date for boosting tariffs on Chinese imports, taken as a sign of progress in the trade talks. Bonds fell and the dollar retreated.
Oil Holds Near Three-Month High as U.S. Extends Truce With China (Bloomberg) Oil steadied near a three-month high in New York as a U.S. move to extend a trade truce with China raised hopes that the world’s two biggest economies would soon resolve a stand-off on tariffs.
Trump calls on OPEC to ‘relax,’ says oil prices are too high (Reuters) U.S. President Donald Trump on Monday expressed concern about oil prices and repeated his previous calls on the Organization of the Petroleum Exporting Countries (OPEC) to keep prices steady.
China January soybean imports from U.S. nearly double vs. December: customs (Reuters) China’s imports of U.S. soybeans nearly doubled in January from the previous month as cargoes booked after a Sino-U.S. trade truce arrived in the world’s top oilseed importer, according to Chinese customs data published late on Monday.
Barrick bids $18 billion for Newmont in gold mega-merger (Reuters) Canada’s Barrick Gold Corp offered to buy U.S. rival Newmont Mining Corp for nearly $18 billion in stock on Monday, in a deal that would combine the world’s two largest gold producers.
Overnight markets
| Cda Benchmarks | Yield | Tsy Benchmarks | Yield |
| 2 Year | 1.789% | 2 Year | 2.51% |
| 5 Year | 1.817% | 5 Year | 2.491% |
| 10 Year | 1.912% | 10 Year | 2.675% |
| 30 Year | 2.16% | 30 Year | 3.035% |
US Economic Data
| 8:30 AM | Chicago Fed Nat Activity Index, Jan Surv 0.15 Prior 0.27 |
| 10:00 AM | Wholesale Inventories MoM, Dec P Surv 0.3% Prior 0.3% |
| Wholesale Trade Sales MoM, Dec Surv -0.3% Prior -0.6% | |
| 10:30 AM | Dallas Fed Manf. Activity, Feb Surv 4.9 Prior 1.0 |
Canadian Economic Data
| 10:00 AM | Bloomberg Nanos Confidence, Feb 22 Prior 54.8 |
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