Market Update

US tsys higher, rebounding from early losses, with the long end outperforming and the 10Y 2.75% (-1bp). Quiet start to otherwise busy week in the US in terms of data with Chicago Fed Index & Dallas Fed Man Index .  Equity futures moving lower (S&P -17) after Caterpillar missed Q4 eps by $0.44 – $2.55 vs $2.99, shares are ~6% lower pre-mkt.  FOMC decision & Non-farm payrolls highlights for the week – Fed chairman Powell may provide more clarity of the topic of balance sheet reduction after last week’s article in the WSJ.

News headlines

$1.5 trillion U.S. tax cut has no major impact on business capex plans: survey (Reuters) The Trump administration’s $1.5 trillion cut tax package appeared to have no major impact on businesses’ capital investment or hiring plans, according to a survey released a year after the biggest overhaul of the U.S. tax code in more than 30 years.

Stock futures dip on weak Caterpillar forecast, China woes (Reuters) U.S. stock index futures dipped on Monday, as weak forecast from Caterpillar added to nerves about Chinese economy, while optimism over the end to the longest U.S. government shutdown in history faded.

Trudeau Ousts China Envoy After Comments About Huawei Case (Bloomberg) Canadian Prime Minister Justin Trudeau has ousted his ambassador to China in the middle of a diplomatic feud with Beijing after a string of public remarks drew criticism.

Explainer: Key Issues, implications of U.S.-China trade talks (Reuters) U.S.-China trade talks will reach a pivotal phase this week when Chinese Vice Premier Liu He comes to Washington for negotiations with his U.S. counterparts, U.S. Trade Representative Robert Lighthizer and U.S. Treasury Secretary Steven Mnuchin.

UPDATE 1-Sterling trade turns cautious ahead of parliamentary votes on Brexit (Reuters) The pound slipped on Monday after posting its biggest weekly rise in more than 15 months last week as investors took profits before crucial votes in the British parliament that will aim to break the Brexit deadlock.

Dollar dips as investors prepare for volatile markets, Fed meeting (Reuters) The euro climbed to a 10-day high on Monday as investors sold the dollar and prepared for volatile markets before U.S.-China trade talks and a Federal Reserve policy decision.

Long winter’s nap? Global slowdown, market fears could extend Fed pause (Reuters) Ebbing global growth and shaky financial markets threw the U.S. Federal Reserve off course in early 2016, and it took nearly a year for officials to regain confidence growth would continue and convince investors they would again raise interest rates.

Overnight markets

Cda Benchmarks Yield Tsy Benchmarks Yield
2 Year 1.883% 2 Year 2.609%
5 Year 1.906% 5 Year 2.603%
10 Year 1.988% 10 Year 2.758%
30 Year 2.208% 30 Year 3.064%

US Economic Data

8:30 AM Chicago Fed Nat Activity Index, Dec Prior 0.22  
10:30 AM Dallas Fed Manf. Activity, Jan Surv -2.7 Prior -5.1  

Canadian Economic Data

10:00 AM Bloomberg Nanos  Confidence, Jan 25 Prior 54.5

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