A bit of risk-off overnight has given a bit of a lift to Tsys, but overall, markets look flat Tuesday ahead of a full slate of Fed speakers. U.S. sanctions placed Monday on Iran’s Ayatollah Khamenei and Tehran’s declaration that the ‘diplomatic path is shut’ subdued risk appetite. But Tsys ultimately came off intraday highs as European trading picked up, Sep 10-Yr futures (TY) last up 2.5/32 at 128-0.5 (L: 127-28.5 / H: 128-06). The 2-Yr yield is down 0.5bps at 1.7277%, 5-Yr is down 0.7bps at 1.7408%, 10-Yr is down 0.7bps at 2.0073%, and 30-Yr is down 1.1bps at 2.5335%. Equity futures are a little lower (S&P off 0.1%), DXY up 0.1%. Fedspeak in spades today: Williams at 8h45, Bostic at noon, Powell at 13h00, Barkin at 15h30, and Bullard at 18h30. Data includes Conf. Board cons. confidence and new home sales 10h00.

News headlines

Stocks Slip on Geopolitical Tensions; Gold Climbs: Markets Wrap (Bloomberg) U.S. equity futures edged lower alongside European and Asian stocks on Tuesday as geopolitical tensions simmered in the build up to this week’s G-20 meeting. Gold and the yen rose as investors sought safer assets.

Futures lower on Iran tensions, trade worries (Reuters) U.S. stock futures were pulled lower by Iran tensions and trade worries on Tuesday, with investors focusing on Federal Reserve officials for more clarity on interest rates.

TSX futures down as oil prices dip (Reuters) Futures pointed to a lower opening for Canada’s main stock index on Tuesday, hit by falling oil prices.

Oil Steadies as Iran Tensions Mingle With Economic Concerns (Bloomberg) Oil steadied after rallying almost 8% in three days as investors weighed the risks of a supply disruption in the Middle East against concerns over the global economy and demand.

Trump agriculture secretary: U.S. farmers ‘casualties’ of trade war – CNN (Reuters) U.S. Agriculture Secretary Sonny Perdue acknowledged that American farmers are being hurt by President Donald Trump’s trade war with China, according to an interview broadcast on Tuesday.

China May rare earth magnet exports to U.S. jump amid threat of restrictions (Reuters) China’s exports of rare earth magnets to the United States rose more than 20% in May from the previous month to their highest since at least 2016, data released by the General Administration of Customs showed on Tuesday, as Beijing considers restricting shipments as part of a long-running trade row.

Euro zone bank profitability may weaken on slowdown: ECB (Reuters) Profitability across the euro zone bank sector is low and weakening growth could further dampen the sector’s prospects, European Central Bank Vice President Luis de Guindos said on Tuesday.

Market Overview: US 10yr note futures are up 0.024% at 127-31, S&P 500 futures are down -0.1% at 2949, Crude oil futures are down -0.35% at $57.7, Gold futures are up 0.79% at $1429.4, DXY is up 0.08% at 96.055, CAD/USD is down 0% at 0.7587.

Cda Benchmarks Yield Tsy Benchmarks Yield
2 Year 1.407% 2 Year 1.74%
5 Year 1.35% 5 Year 1.746%
10 Year 1.463% 10 Year 2.009%
30 Year 1.712% 30 Year 2.537%

US Economic Data

09:00 AM FHFA House Price Index MoM, Apr  Survey: 0.20%  Prior: 0.10%
        S&P CoreLogic CS 20-City YoY NSA, Apr  Survey: 2.50%  Prior: 2.68%
        S&P CoreLogic CS 20-City NSA Index, Apr  Survey: 215.61  Prior: 214.09
10:00 AM Richmond Fed Manufact. Index, Jun  Survey: 2  Prior: 5
        New Home Sales, May  Survey: 684k  Prior: 673k
        New Home Sales MoM, May  Survey: 1.60%  Prior: -6.90%
         Conf. Board Consumer Confidence, Jun  Survey: 131.0  Prior: 134.1

Canadian Economic Data

08:30 AM Wholesale Trade Sales MoM, Apr  Survey: 0.20%  Prior: 1.40%

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