Market Update
US tsys higher, yields 1.5-2.0 bps lower, 10Y 2.665% (-1.8bps), US Q4 GDP expected at 2.2% vs 3.4% in Q3, forecasts were adjusted lower after a 1.2% plunge in Dec retail sales, the sharpest one month decline since Sep 2009. A few Fed speakers today including Clarida saying the data has surprised to the downside somewhat since Dec. Fed chair Powell’s testimony yest reaffirmed patient stance, saying there are crosscurrents buffeting US economy. GOCs higher, 10Y 1.90%, in line with tsys, provis unch with rumours of QC 10Y supply.
News headlines
Stocks Fall After China Data Slip, Korea No-Deal: Markets Wrap (Bloomberg) Stocks dropped as disappointing manufacturing data out of China and an abrupt end to the U.S.-North Korea summit added to a litany of concerns facing investors. Havens, including gold and the yen, climbed.
Canada’s Trudeau disputes ex-minister’s charge she was pressured on SNC-Lavalin (Reuters) Canadian Prime Minister Justin Trudeau, rejecting an opposition call for his resignation, disputed allegations on Wednesday by his former justice minister that government officials inappropriately pressured her to help a major company avoid a corruption trial.
Consumers, weak exports seen curbing U.S. fourth-quarter growth (Reuters) The U.S. economy probably slowed in the fourth quarter, held back by softer consumer spending and weak exports, which could leave 2018 growth just shy of the Trump administration’s 3 percent annual target.
Alberta on track for $6.9B deficit, as oil sands power budget (BNN) A relentless increase in production from Alberta’s oil sands and higher crude prices in the first half of the year are powering the province’s budget through a pipeline shortage that has weighed on economic growth.
Canada’s inflation rate falls to 15-month lows on lower gas prices (BNN) Canada’s annual inflation fell in January to its lowest rate in 15 months as gasoline prices declined, giving the Bank of Canada plenty of breathing room on interest rates.
Canada stock futures dip as U.S.-North Korea summit ends with no deal (Reuters) Futures pointed to a lower opening for Canada’s main stock index on Thursday as U.S. President Donald Trump walked away from a nuclear deal at a summit with North Korea.
Overnight markets
| Cda Benchmarks | Yield | Tsy Benchmarks | Yield |
| 2 Year | 1.762% | 2 Year | 2.48% |
| 5 Year | 1.785% | 5 Year | 2.46% |
| 10 Year | 1.896% | 10 Year | 2.664% |
| 30 Year | 2.143% | 30 Year | 3.05% |
Canadian Economic Data
| 8:30 AM | Current Account Balance, 4Q Surv -$13.25b Prior -$10.34b |
| Industrial Product Price MoM, Jan Surv 0.1% Prior -0.7% | |
| Raw Materials Price Index MoM, Jan Prior 3.8% |
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