Commentaires
16/01/2020
Market Update
US tsys trading slightly higher on below avg volume (300k TY futures), 10Y 1.77%. Phili Fed Survey and Dec Retail Sales coming up, along with NAHB survey and Long-term TICS flows this aft. Core EGBs higher, 10Y gilts/bunds 2bps lower while 2Y gilt yields have collapsed 20bps just this week with market pricing in a cut at this month’s BOE meeting. US equity futures higher – S&P/Nasdaq +0.40%, crude unch. Morgan Stanley +3.5% pre-mkt after huge Q4 eps beat $1.30 vs $0.99. GOCs lagging tsys by 1.5bps in the long end, ADP payrolls due at 8:30. Yesterday BMO was first out of the gate issuing $1.5bln in 5Y bail-in debt at 82, 3x oversubscribed.
News headlines
Futures near record on trade deal, robust earnings (Reuters) U.S. stock index futures hovered near all-time highs on Thursday on optimism over an initial U.S.-China trade deal and a positive start to the fourth-quarter earnings season.
Investors see smoother path for U.S. stocks as Warren’s election odds slip (Reuters) Traders are less worried about political uncertainty in the run-up to the U.S. presidential election, with former Vice President Joe Biden remaining strong in the polls while Senator Elizabeth Warren has lost ground.
ECB takes more upbeat view in December meetings: accounts (Reuters) European Central Bank policymakers took a more upbeat view on economic developments in their December 12 meeting but continued to see an abundance of risk that warrant ultra-easy policies, the accounts of the meeting showed on Thursday.
EU says will assess if US-China deal meets global trade rules (FP) The European Union’s trade chief said on Thursday that the bloc would check to see if a major trade deal struck by the United States and China is compliant with global rules.
China says trade deal good for all, media discourages ‘nitpicking’ (Reuters) Chinese state media on Thursday warned against any “nitpicking” as Beijing portrayed the Phase 1 trade deal with United States and its new commitments to massive purchases of American goods as a boon for China’s economy.
Trade deal no panacea for rocky U.S. relations with China (Reuters) From Huawei to the South China Sea, deep political rifts between Beijing and Washington are set to persist, despite a trade relations breakthrough, as the United States pushes back against an increasingly powerful and assertive China.
TSX futures climb as U.S.- China sign trade deal (Reuters) Canada’s main stock index futures rose on Thursday as the U.S. and China signed their Phase 1 trade deal, relieving market jitters after the 18-month trade conflict.
BNY Mellon profit surges 67% on one-time gain (Reuters) Bank of New York Mellon Corp (BK.N), the world’s largest custodian bank, reported a 67% jump in quarterly profit on Thursday, helped by a one-time gain from the sale of an unspecified equity investment.
Morgan Stanley beats profit estimates as bond trading revenue surges (Reuters) Morgan Stanley (MS.N) beat estimates for quarterly profit by a wide margin on Thursday, powered by strength in its investment management, bond trading and underwriting businesses.
Bombardier slashes forecast as it looks to accelerate debt payments (BNNBloomberg) Bombardier Inc. is cutting its full-year revenue and profit forecasts and is hunting for ways to accelerate debt repayments, the company said Thursday.
The Montreal-based plane and train maker expects its revenue for 2019 to come in at US$15.8 billion, down from previous forecast of as much as US$17 billion. It also now sees its adjusted earnings before interest and taxes coming in at US$400 million, down from its previous outlook of US$700 million and US$800 million.
Market Overview: US 10yr note futures are up 0.072% at 129-14, S&P 500 futures are up 0.29% at 3303.25, Crude oil futures are down -0.17% at $57.71, Gold futures are up 0.15% at $1556.4, DXY is down -0.11% at 97.121, CAD/USD is down -0.01% at 0.7669.
| Cda Benchmarks | Yield | Tsy Benchmarks | Yield |
| 2 Year | 1.635% | 2 Year | 1.552% |
| 5 Year | 1.551% | 5 Year | 1.59% |
| 10 Year | 1.537% | 10 Year | 1.774% |
| 30 Year | 1.661% | 30 Year | 2.228% |
US Economic Data
| 08:30 AM | Philadelphia Fed Business Outlook, Jan Survey: 380.00% Prior: 30.00% |
| Import Price Index MoM, Dec Survey: 0.30% Prior: 0.20% | |
| Import Price Index ex Petroleum MoM, Dec Survey: 0.10% Prior: 0.20% | |
| Import Price Index YoY, Dec Survey: 0.50% Prior: -1.30% | |
| Export Price Index MoM, Dec Survey: 0.20% Prior: 0.20% | |
| Export Price Index YoY, Dec Survey: — Prior: -1.30% | |
| Retail Sales Advance MoM, Dec Survey: 0.30% Prior: 0.20% | |
| Retail Sales Ex Auto MoM, Dec Survey: 0.50% Prior: 0.10% | |
| Retail Sales Ex Auto and Gas, Dec Survey: 0.40% Prior: 0.00% | |
| Retail Sales Control Group, Dec Survey: 0.40% Prior: 0.10% | |
| Initial Jobless Claims, 40544 Survey: 218k Prior: 214k | |
| Continuing Claims, 37987 Survey: 1750k Prior: 1803k | |
| 09:45 AM | Bloomberg Consumer Comfort, Survey: — Prior: 65.1 |
| 10:00 AM | Business Inventories, Nov Survey: -0.20% Prior: 0.20% |
| NAHB Housing Market Index, Jan Survey: 74 Prior: 76 | |
| 04:00 PM | Net Long-term TIC Flows, Nov Survey: — Prior: $32.5b |
| Total Net TIC Flows, Nov Survey: — Prior: -$48.3b |
Canadian Economic Data
| 08:30 AM | ADP Releases Payroll Data |
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
15/01/2020
Market Update
US tsys trading higher on decent volume (400k TY fut), long end outperforming, 10Y 1.795(-1.5bps). US futures close to unch, paring earlier losses: Target -7.0% pre-mkt after holiday sales rose 1.4% vs 5.7% last year, comparable sales now expected to be 1.4% for the qtr vs 3.8% forecast. BAC beat on Q4 eps , with ‘solid client activity in growing loans and gathering deposits’, stock is down slightly pre-mkt. Big rally in gilts on weaker UK CPI (1.3% vs 1.5% exp) and comments from MPC Saunders on need for further stimulus, 10Y 8bps lower @ 0.64% – a two month low while the 10Y gilt/bund spd at 20 month lows. GOCs higher & 1bp narrower vs tsys out the curve, 10Y approaching Jan low 1.53%
News headlines
U.S. Futures Slip Amid Mixed Earnings; Bonds Gain: Markets Wrap (Bloomberg) U.S. equity-index futures slipped amid mixed corporate earnings and concern over trade tensions that lingered even as America and China were set to sign their initial accord. Treasuries rose and the dollar steadied.
TSX futures rise as gold prices gain ahead of U.S.-China trade deal (Reuters) Canada’s main stock index futures rose on Wednesday ahead of signing of the U.S.-China phase 1 trade deal, supported by gains in gold prices.
U.S., China set to sign massive purchases deal, easing trade war (Reuters) The U.S.-China trade war is set to enter a new, quieter phase on Wednesday as U.S. President Donald Trump and Chinese Vice Premier Liu He sign an initial trade deal that aims to vastly increase Chinese purchases of U.S. manufactured products, agricultural goods, energy and services.
Phase 2 of China trade deal to address certain tech issues: U.S. Treasury Secretary (Reuters) U.S. Treasury Secretary Steven Mnuchin said on Wednesday that some technology and cybersecurity issues will be resolved in the next chapter of a deal to end the trade war between the United States and China.
German growth slows sharply in 2019 as trade disputes bite (Reuters) The German economy grew by 0.6% in 2019, the weakest expansion rate since 2013 and a marked cooling from the previous year, as export-dependent manufacturers in Europe’s largest economy face increased headwinds from trade disputes and less foreign demand.
Exclusive: India plans new law to protect foreign investment – sources (Reuters) India is planning a new law to safeguard foreign investment by speeding up dispute resolution, aiming to attract more capital from overseas to boost stuttering domestic growth, two officials with direct knowledge of the matter told Reuters.
China tariffs to remain until after 2020 election despite deal (BNN) Existing tariffs on billions of dollars of Chinese goods coming into the U.S. are likely to stay in place until after the American presidential election, and any move to reduce them will hinge on Beijing’s compliance with the terms of a phase-one trade accord, people familiar with the matter said.
Keystone XL inches forward with work planned for next month (BNN) TC Energy Corp. plans to begin pre-construction work on the Keystone XL oil pipeline next month, moving the long-delayed project forward even as opponents continue to fight it in court.
Market Overview: US 10yr note futures are up 0.121% at 129-10, S&P 500 futures are down -0.03% at 3287, Crude oil futures are down -0.03% at $58.21, Gold futures are up 0.39% at $1550.6, DXY is down -0.06% at 97.31, CAD/USD is up 0.04% at 0.7653.
| Cda Benchmarks | Yield | Tsy Benchmarks | Yield |
| 2 Year | 1.652% | 2 Year | 1.564% |
| 5 Year | 1.573% | 5 Year | 1.608% |
| 10 Year | 1.561% | 10 Year | 1.795% |
| 30 Year | 1.673% | 30 Year | 2.253% |
US Economic Data
| 07:00 AM | MBA Mortgage Applications, Jan 10 Survey: — Actual: 30.20% Prior: 13.50% |
| 08:30 AM | PPI Final Demand MoM, Dec Survey: 0.20% Actual: 0.10% Prior: 0.00% |
| PPI Ex Food and Energy MoM, Dec Survey: 0.20% Actual: 0.10% Prior: -0.20% | |
| PPI Ex Food, Energy, Trade MoM, Dec Survey: 0.20% Actual: 0.10% Prior: 0.00% | |
| PPI Final Demand YoY, Dec Survey: 1.30% Actual: 1.30% Prior: 1.10% | |
| PPI Ex Food and Energy YoY, Dec Survey: 1.30% Actual: 1.10% Prior: 1.30% | |
| PPI Ex Food, Energy, Trade YoY, Dec Survey: — Actual: 1.50% Prior: 1.30% | |
| Empire Manufacturing, Jan Survey: 3.60 Actual: 4.80 Prior: 3.50 | |
| 02:00 PM | U.S. Federal Reserve Releases Beige Book |
Canadian Economic Data
| 09:00 AM | Existing Home Sales MoM, Dec Survey: — Prior: 0.60% |
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
14/01/2020
Market Update
US tsys trading slightly higher on avg volume (330k TY futures), 10Y 1.84%, US equity futures paring earlier losses (S&P -3.75). JPM up ~2.0% pre-mkt on stronger Q4 fixed income & trading revenues, eps $2.57 vs $2.36 est. US Dec CPI on tap – 0.3% m/m, 2.4% y/y and 2.1% core expected. Core EGBs higher, UK gilts continue to outperform, 2Y UK/German spread at two-year lows, GBP extending its decline on speculation of BOE easing this month in the wake of negative Nov GDP. GOCs higher in line with tsys, BOC Business Outlook survey indicator rose to the highest since 2018, 0.7% in Q4 vs 0.3% prev. while inflation expectations over the next year fell to the lowest since 2017.
News headlines
U.S. Futures, Europe Stocks Fluctuate; Bonds Rise: Markets Wrap (Bloomberg) American equity-index futures fluctuated with European stocks on Tuesday as U.S. earnings season kicked off and officials prepared to sign the China trade deal in Washington. The yuan held close to its strongest level since July.
CANADA STOCKS-TSX futures drop ahead of Phase 1 U.S-China trade deal (Reuters) Canada’s main stock index futures fell on Tuesday, as investors remained cautious before the U.S.-China Phase 1 trade deal is signed on Wednesday.
Futures pause after rally, JPMorgan results draw cheer (Reuters) U.S. stock index futures were flat to slightly lower on Tuesday, as investors took a breather following a record rally, even as JPMorgan’s quarterly results set a positive tone for big bank earnings.
Phase 1 commodity targets likely more than China can chew: analysts (Reuters) Commodity traders and analysts are struggling to map out how China will reach the eye-popping amounts it is committing to buy from the United States under Phase 1 of their trade deal.
China’s yuan gains after U.S. drops China FX manipulator label (Reuters) China’s yuan climbed to its highest level since July on Tuesday and the Japanese yen plumbed eight-month lows as the U.S. Treasury Department reversed its decision in August to designate China as a currency manipulator.
China posts strong December exports as world awaits Sino-U.S. trade deal signing (Reuters) China’s exports rose for the first time in five months in December and by more than expected, signaling a modest recovery in demand as Beijing and Washington agreed to defuse their prolonged trade war.
Switzerland rejects U.S. allegations of currency manipulation (Reuters) Switzerland is not manipulating the Swiss franc for competitive gain, the country’s government said on Tuesday after the United States added it to a watchlist of currency manipulators.
Gold Falls Again as Demand for Havens Wanes (Bloomberg) Gold nudged lower, extending declines from last week’s peak, as the soon-to-be clinched U.S.-China trade pact undermines the case for havens. Palladium hit a fresh record.
Market Overview: US 10yr note futures are up 0.024% at 128-31, S&P 500 futures are down -0.06% at 3287.75, Crude oil futures are up 0.72% at $58.5, Gold futures are down -0.5% at $1542.9, DXY is up 0.13% at 97.468, CAD/USD is up 0.1% at 0.7651.
| Cda Benchmarks | Yield | Tsy Benchmarks | Yield |
| 2 Year | 1.666% | 2 Year | 1.586% |
| 5 Year | 1.616% | 5 Year | 1.646% |
| 10 Year | 1.61% | 10 Year | 1.842% |
| 30 Year | 1.712% | 30 Year | 2.3% |
US Economic Data
| 06:00 AM | NFIB Small Business Optimism, Dec Survey: 104.6 Actual: 102.7 Prior: 104.7 |
| 08:30 AM | CPI MoM, Dec Survey: 0.30% Prior: 0.30% |
| CPI Ex Food and Energy MoM, Dec Survey: 0.20% Prior: 0.20% | |
| CPI YoY, Dec Survey: 2.40% Prior: 2.10% | |
| CPI Ex Food and Energy YoY, Dec Survey: 2.30% Prior: 2.30% | |
| CPI Core Index SA, Dec Survey: 266.111 Prior: 265.620 | |
| CPI Index NSA, Dec Survey: 257.169 Prior: 257.208 | |
| Real Avg Weekly Earnings YoY, Dec Survey: — Prior: 1.10% | |
| Real Avg Hourly Earning YoY, Dec Survey: — Prior: 1.10% |
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