Market Update
US tsys pressured in recent trade after German flash HICP inflation came in stronger – 2.1% vs 1.7% and US equity futures move higher on earnings, US 10Y 2.535% (+1bp). Core Euro bonds underperforming tsys, 10Y bund yields +3bps, gilts +4bps. Q1 Eurozone GDP 1.2% y/y vs 1.1%. US equities recouping losses from Google disappointment after positive earnings from MCD, GE. In Canada, GOCs lower, in line with tsys after Feb GDP came in below exp (-0.1% vs 0.0%), curve 1bp steeper 2s10s.
News headlines
Mnuchin hopes for ‘substantial progress’ in China trade talks (Reuters) U.S. Treasury Secretary Steven Mnuchin said on Tuesday that he hopes to make “substantial progress” with Chinese negotiators in the next two rounds of trade talks, as the world’s two largest economies look for ways to end their bruising trade war.
Iran says it will keep exporting oil despite U.S. pressure (Reuters) Iran will continue to export oil despite U.S. pressure aimed at reducing the country’s crude shipments to zero, Iranian President Hassan Rouhani said on Tuesday.
TSX futures slip, Feb GDP in focus (Reuters) Futures for Canada’s main stock index were lower on Tuesday, as investors awaited Canada’s February gross domestic product (GDP) data, which is due later in the day.
Stocks Lose Traction on Mixed Earnings; Euro Gains: Markets Wrap (Bloomberg) U.S. equity futures were mixed and European stocks edged lower on Tuesday while Asian shares slipped as investors weighed another mixed bag of corporate results. Treasuries were steady a day before the next Federal Reserve policy decision.
Oil Gains as Saudis Talk of Extending Cuts, Venezuela Escalates (Bloomberg) Oil rose as Saudi Arabia signaled OPEC and its allies could extend supply cuts to the end of the year, while Venezuela’s opposition leader called for a military uprising.
Big banks break away from lobby groups in Brexit trade deal talks (Reuters) A group of banks are directly feeding the British government ideas for a Brexit financial services trade deal, bypassing the industry’s major lobby groups after their blueprint for a future relationship with the EU was spurned by Brussels last year.
Equities drop after China data; euro zone growth lifts single currency (Reuters) European shares edged down on Tuesday after weak Chinese business surveys doused appetite for risk, while the single currency climbed after euro zone growth beat expectations.
Overnight markets
| Cda Benchmarks | Yield | Tsy Benchmarks | Yield |
| 2 Year | 1.574% | 2 Year | 2.286% |
| 5 Year | 1.559% | 5 Year | 2.308% |
| 10 Year | 1.729% | 10 Year | 2.527% |
| 30 Year | 2.01% | 30 Year | 2.958% |
US Economic Data
| 08:30 AM | Employment Cost Index, 1Q Survey 0.70% Acutal 0.7% Prior 0.70% |
| 09:45 AM | MNI Chicago PMI, Apr Survey 58.5 Prior 58.7 |
| 10:00 AM | Pending Home Sales MoM, Mar Survey 1.50% Prior -1.00% |
| Conf. Board Consumer Confidence, Apr Survey 126.8 Prior 124.1 |
Canadian Economic Data
| 08:30 AM | GDP MoM, Feb Survey 0.00% Actual -0.1% Prior 0.30% |
| GDP YoY, Feb Survey 1.40% Actual 1.1% Prior 1.60% | |
| Industrial Product Price MoM, Mar Survey – Actual 1.3% Prior 0.30% | |
| Raw Materials Price Index MoM, Mar Survey – Actual 2.8% Prior 4.60% |
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