Market update

US tsys are higher after rising for most of the o/n session, with a muted reaction to weaker July Pers spending data. US 10Y 2.16 (-3bps), European equities lower despite the surge in China (4.8%). Focus on various Fed speakers at the Jackson Hole symposium. Fed Bullard , Mester leaning towards Sep rate hike while Kocherlakota believes it is premature. Hilsenrath article in the WSJ (see above) notes foreign bankers are urging the Fed not to waiver and raise rates already.  In Canada, GOCs are higher led by the 10Y (~5bps), reversing half of this week’s cheapening, spds ~1bp tighter vs tsys after mixed wholesale inflation data. Provis opening 0.5bps tighter, long Onts lifted @ 99.5, the 45/25 bx tighter as well 11.3/11.1. QC/Ont 45 rl unch 6/5.5.

News headlines

Overnight markets

  • Overview: IG24 5Y 78.5/79.5 (+0.75), US 10yr note futures are up +0.15% at 128-04+, S&P 500 futures are down -0.62% at 1977.0, Crude oil futures are down -1.13% at 42.08, Gold futures are up +0.36% at $1126.6, DXY is flat at 95.608.
  • US BANK CDS (5yr): BAC 76/81 (+0), GS 95/100 (+0), MS 86/91 (+0), C 88/93 (+1), JPM 77/82 (+0), WFC 55/60 (-1)

 US Economic Data

  • Personal income came in at 0.4% MoM in July compared to June 0.4%.
  • Personal spending grew 0.3% MoM in July versus previous month 0.3%.
  • PCE came in at 0.1% MoM (0.3% YoY) in July versus June 0.2% MoM (0.3% YoY).
  • PCE core increased 0.1% MoM (1.2% YoY) in July compared to 0.1% MoM (1.3% YoY) in June.
  •  University of Michigan confidence (Final) is expected at 93.0 in August 0.1 point higher than preliminary report.

Canadian Economic Data

  • Industrial product price increase 0.7% MoM in July after climbing in June 0.5%.
  • Raw materials price index came in at -5.9% MoM in July versus +0.2% for previous month.


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, Pierre-Olivier Boulanger
Institutional Bond and Equity Desk
CTI Capital Valeurs Mobilières Inc.

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