Market Update
US tsys slightly higher, curve 0.5bps steeper, 10Y 2.74% on avg volume in TY futures (316k). Crude rebounding from yest losses, up 0.85% after the US levied sanctions on Venezuela’s State oil co. Equities higher in Europe (Stoxx +0.60%), US equity futures higher (S&P +2) – trade talks ongoing between the US & China with the US govt launching criminal charges against Huawei. Gilts underperforming bunds as mkt awaits UK parliament votes on Brexit amendment. GOCs lower in line with tsys, curve unch 10Y 1.96%
News headlines
Powell faces early reckoning on Fed’s $4-trillion question (Reuters) Federal Reserve Chairman Jerome Powell has a problem: how to explain that the Fed may soon begin to taper its ongoing asset-shedding operation without looking like he’s hunkering down for a coming recession, or caving to U.S. President Donald Trump.
Gold reaches seven-month high as stocks, dollar struggle (Reuters) Gold climbed to a seven-month high on Tuesday as markets opted for caution before three major macro events and a blizzard of big tech company earnings in the coming days, starting with Apple later.
Stocks Mixed as Investors Weigh U.S.-China Outlook: Markets Wrap (Bloomberg) It was a mixed picture across global stock markets on Tuesday, with European shares climbing, U.S. futures mixed and Asian equities slipping as investors juggled concerns about the fallout from America’s trade war with China against hopes for progress in this week’s talks.
EU-Canada trade deal is lawful: EU court adviser (Reuters) The EU-Canada free trade deal’s provisions on investor protection are in line with EU law, a senior court adviser said on Tuesday in a recommendation to the European Court of Justice (ECJ) about terms seen by critics as favoring multinationals.
MONEY MARKETS-Dollar LIBOR falls for five straight sessions (Reuters) A key barometer of interbank interest rates declined on Tuesday for the fifth consecutive trading session to its lowest level since early December ahead of the U.S. Federal Reserve’s two-day policy meeting.
Trump to wade into China trade talks as U.S. targets Huawei (BNN) The Trump administration will press China to prove it can keep promises in talks this week aimed at ending the trade war, Treasury Secretary Steven Mnuchin said, as the U.S. ratcheted up legal pressure on one of the biggest examples of Chinese technological might.
U.S. sanctions Venezuela state oil firm, escalating pressure on Maduro (Reuters) The Trump administration on Monday imposed sweeping sanctions on Venezuelan state-owned oil firm PDVSA, aimed at severely curbing the OPEC member’s crude exports to the United States and at pressuring socialist President Nicolas Maduro to step down.
Overnight markets
| Cda Benchmarks | Yield | Tsy Benchmarks | Yield |
| 2 Year | 1.868% | 2 Year | 2.583% |
| 5 Year | 1.881% | 5 Year | 2.572% |
| 10 Year | 1.959% | 10 Year | 2.739% |
| 30 Year | 2.18% | 30 Year | 3.069% |
US Economic Data
| 9:00 AM | S&P CoreLogic CS 20-City YoY NSA, Nov Surv 4.90% Prior 5.03% |
| S&P CoreLogic CS 20-City MoM SA, Nov Surv 0.40% Prior 0.41% | |
| S&P CoreLogic CS 20-City NSA Index, Nov Prior 213.89 | |
| S&P CoreLogic CS US HPI YoY NSA, Nov Prior 5.48% | |
| S&P CoreLogic CS US HPI NSA Index, Nov Prior 206.03 | |
| 10:00 AM | Conf. Board Consumer Confidence, Jan Surv 124.0 Prior 128.1 |
Canadian Economic Data
There is no Canadian economic data for today.
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