Commentaires matinaux

Market Update

US tsys trading weaker, yields 1.5-2.5bps higher with the 10Y 1.845% (+2.3bps), avg volume in TY futures (350k). Equity futures higher, S&P +14 – relief with phase one trade deal confirmed Friday and UK election decided. Core EGBs outperforming after misses in French, German and UK PMIs, 10Y bund/tsy spread 4bps wider.  Focus this week in terms of US data Philly Fed Thurs and Q3 GDP Friday. GOCs lower, 2bps wider vs tsys, 10Y 1.625%.  Canadian data this week highlighted by CPI Wednesday and Retail Sales Friday.

News headlines

U.S. Futures Climb as European Stocks Hit Record: Markets Wrap (Bloomberg) U.S. equity futures and European stocks started the week on the front foot amid hopes a partial trade deal between America and China eases a key risk for investors heading into year-end. Treasuries slipped.

TSX futures rise on trade optimism (Reuters) Canada’s main stock index futures rose on Monday, following a preliminary trade agreement between the United States and China, which was announced on Friday.

Oil Near Three-Month High on Cautious Optimism Over Trade Deal (Bloomberg) Oil steadied near a three-month high on cautious optimism that a preliminary trade deal between the U.S. and China will support global fuel consumption.

U.S. top trade negotiator praises deal, China remains cautious (Reuters) U.S. President Donald Trump’s top trade negotiator praised a “phase one” U.S.-China trade deal which is expected to nearly double U.S. exports to China over the next two years, while China remained cautious ahead of the signing of the agreement.

Euro zone business growth stayed weak in December: flash PMIs (Reuters) Euro zone business growth remained weak in December, with tepid foreign demand exacerbating a contraction in manufacturing and offsetting a slight pick-up in services activity, although some analysts saw signs of stabilization.

Costco in Caracas: how Florida goods flood Venezuelan stores (Reuters) While U.S. President Donald Trump wants to drive Venezuela’s socialist ruler out of power with economic sanctions, there has in fact been a burgeoning influx of American-bought goods from Nutella spread to Oreo cookies.

ECB has minor impact on inequality: Lane (Reuters) The European Central Bank’s monetary policy has relatively little impact on inequality, Philip Lane, the bank’s chief economist said, responding in part to criticism that large scale asset buys widen the social gap.

China’s factory, retail sectors shine as trade tensions thaw (Reuters) Growth in China’s industrial and retail sectors beat expectations in November, as government support propped up demand in the world’s second-largest economy and amid easing trade hostilities with Washington.

Market Overview: US 10yr note futures are down -0.242% at 128-23, S&P 500 futures are up 0.46% at 3190, Crude oil futures are down 0% at $60.07, Gold futures are down -0.01% at $1481, DXY is down -0.22% at 96.961, CAD/USD is down -0.39% at 0.7625.

Cda Benchmarks	Yield	Tsy Benchmarks	Yield
2 Year	1.686%	2 Year	1.628%
5 Year	1.628%	5 Year	1.687%
10 Year	1.625%	10 Year	1.854%
30 Year	1.719%	30 Year	2.278%

US Economic Data

08:30 AM	Empire Manufacturing, Dec  Survey: 4.0  Prior: 2.9
09:45 AM	Markit US Composite PMI, Dec P  Survey: —  Prior: 52.0
	Markit US Manufacturing PMI, Dec P  Survey: 52.6  Prior: 52.6
	Markit US Services PMI, Dec P  Survey: 52.0  Prior: 51.6
10:00 AM	NAHB Housing Market Index, Dec  Survey: 70  Prior: 70
04:00 PM	Net Long-term TIC Flows, Oct  Survey: —  Prior: $49.5b
	Total Net TIC Flows, Oct  Survey: —  Prior: -$37.6b

Canadian Economic Data

08:30 AM	Int’l Securities Transactions, Oct  Survey: —  Prior: 4.76b
09:00 AM	Existing Home Sales MoM, Nov  Survey: —  Prior: 0.00%
10:00 AM	Bloomberg Nanos Confidence, Dec 13  Survey: —  Prior: 55.1

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

Market Update

US tsys trading higher, heavy volume in TY futures (975k), with a lot of positions taken post UK election, considering size of Conservative majority came as a surprise. US retail sales weaker than exp, ex- Auto & Gas 0.0% vs 0.4% exp. UK gilts erasing most of early losses after gapping 80 ticks lower after the election results, with the pound also giving up some early gains. Equity futures higher, S&P +9, crude higher for 2nd day approaching $60 for first time since Sep. China press conference on phase one trade deal with US scheduled for 9:30ET. GOCs higher in line with tsys post 8:30 data, 10Y 1.65% – yields gapping higher yest on positive risk sentiment, while provincials are at narrows for the year.

News headlines

Johnson election victory propels Britain toward swift Brexit (Reuters)Britain was speeding toward Brexit on Friday after Prime Minister Boris Johnson won a crushing election victory, ending three years of uncertainty since the country decided to leave the bloc.

New NAFTA deal lifts cloud of uncertainty hanging over Canadian business: Poloz (FP) Bank of Canada Governor Stephen Poloz suggested Thursday that the ratification of a new North American free-trade deal is key to finally eliminating uncertainty that has hovered over businesses trying to make investment decisions since the election of U.S. President Donald Trump.

Futures up on trade deal hopes; tariff deadline closes in (Reuters) U.S. stock index futures rose on Friday on hopes that the United States and China could reach an initial deal to end their trade war after Washington set its terms for an agreement, just days before fresh levies on Chinese goods kick in.

U.S. sets China trade deal terms, sources say, but Beijing mum (Reuters) Washington has set its terms for a trade deal with China, offering to suspend some tariffs on Chinese goods and cut others in exchange for Beijing’s buying more American farm goods, U.S. sources said on Thursday.

Rattling Republicans, U.S. House committee delays impeachment vote to Friday (Reuters) Democrats delayed an impeachment vote by a U.S. House Committee just before midnight, incensing Republicans and setting up a Friday showdown over President Donald Trump’s future.

U.S. Congress negotiators, White House set tentative deal on fiscal 2020 funding (Reuters) Senior negotiators in the U.S. Congress on Thursday reached a tentative deal with the White House on a series of bills to fund federal agencies through Sept. 30, 2020, which would avert partial government shutdowns next week.

Desmarais brothers to step down as CEOs in overhaul of Power Corp (FP) Andre Desmarais and Paul Desmarais Jr. are stepping down as co-chief executive officers of Power Corp. of Canada as part of a massive reorganization at one of the country’s largest financial services firms.

Market Overview: US 10yr note futures are up 0.085% at 128-16, S&P 500 futures are up 0.24% at 3178.75, Crude oil futures are up 0.93% at $59.73, Gold futures are up 0.21% at $1475.4, DXY is down -0.55% at 96.862, CAD/USD is down -0.14% at 0.7596.

Cda Benchmarks	Yield	Tsy Benchmarks	Yield
2 Year	1.688%	2 Year	1.628%
5 Year	1.645%	5 Year	1.706%
10 Year	1.654%	10 Year	1.877%
30 Year	1.742%	30 Year	2.299%

US Economic Data

08:30 AM	Import Price Index MoM, Nov  Survey: 0.20%  Actual: 0.20% Prior: -0.50%
	Import Price Index ex Petroleum MoM, Nov  Survey: -0.10%  Actual: 0.20% Prior: -0.10%
	Import Price Index YoY, Nov  Survey: -1.20%  Actual: -1.30% Prior: -3.00%
	Export Price Index MoM, Nov  Survey: 0.10%  Actual: 0.20% Prior: -0.10%
	Export Price Index YoY, Nov  Survey: —  Actual: -1.30% Prior: -2.20%
	Retail Sales Advance MoM, Nov  Survey: 0.50%  Actual: 0.20% Prior: 0.30%
	Retail Sales Ex Auto MoM, Nov  Survey: 0.40%  Actual: 0.10% Prior: 0.20%
	Retail Sales Ex Auto and Gas, Nov  Survey: 0.40%  Actual: 0.00% Prior: 0.10%
	Retail Sales Control Group, Nov  Survey: 0.30%  Actual: 0.10% Prior: 0.30%
09:45 AM	Bloomberg Dec. United States Economic Survey
10:00 AM	Business Inventories, Oct  Survey: 0.20%  Prior: 0.00%

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

Market Update

US tsys trading slightly lower, 10Y 1.80% (+0.5bps), avg volume in TY futures (300k) and narrow o/n range. ECB left marginal lending rate at 0.25% as exp, bond buying to continue, Christine Lagarde first press conference at 9:00ET. Core EGBs higher led by 10Y gilts on election day, pricing in risk of a minority Conservative govt, so called “hung parliament”.  GOCs slightly higher in the short end, Can/US close to recent wides, retracing last Friday’s employment rally. Telus priced $900mln 2 part 10s & longs (158 & 230), bonds closing unch. This morning CHT prices 5Y deal in the area of 27 bps (now 26.5/26)

News headlines

U.S. Futures, Stocks Swing; Bonds Rise After ECB: Markets Wrap (Bloomberg) U.S. equity futures fluctuated alongside stocks in Europe on Thursday as investors digested the latest signals from some of the world’s major central banks. The euro held steady and bonds in the region climbed as European policy makers kept rates unchanged.

CANADA STOCKS-TSX futures up as oil prices rise (Reuters) Futures for Canada’s main stock index were marginally higher on Thursday, as oil prices rose after OPEC forecast a supply deficit next year.

Oil Rebounds Though Outlook Remains Clouded by Oversupply (Bloomberg) Oil rebounded from the previous session’s loss, though the outlook remained clouded by rising U.S. stockpiles and concern that OPEC and its allies aren’t taking enough action to balance the market.

Lagarde’s ECB Keeps Policy on Hold as Strategy Review Looms (Bloomberg) The European Central Bank kept monetary stimulus unchanged at President Christine Lagarde’s first policy meeting, shifting the focus to when she’ll announce her review of the institution’s strategy for safeguarding the euro-zone economy.

Wall Street, Fed prep to avoid year end disruption in repo markets (Reuters) With memories of September’s historic spike in short-term funding costs still raw, Wall Street and the Federal Reserve are gearing up for another potential cash crunch at year end.

‘Black Swan’ index flashes yellow: Wall Street is not scared (Reuters) The options-based Black Swan index may be signaling surging demand from investors for protection against a stock market crash, but Wall Street analysts see little reason to panic.

Aramco shares closing price on Thursday put value slightly below $2 trillion (Reuters) Saudi Aramco’s (2222.SE) shares closed at 36.8 Saudi riyals on Thursday, putting the company’s market value slightly below $2 trillion.

China says in close communication with U.S. on trade as fresh tariffs loom (Reuters) China and the United States are in close communication on trade, its commerce ministry said on Thursday, declining to comment on possible retaliatory steps if Washington imposes more tariffs on Chinese goods this weekend.

WTO appeals judges to stay on to complete several decisions: WTO official (Reuters) World Trade Organization (WTO) judges will complete decisions on three pending appeals for which hearings have been held – despite the collapse of the Appellate Body earlier this week – a WTO official said on Thursday.

New Nafta Leaves Winners and Losers Across North America (Bloomberg) Companies, workers and lawmakers in three countries have spent the past year in limbo awaiting final touches on the U.S.-Mexico-Canada free-trade agreement. Now they have a better sense of who won — and who lost.

Market Overview: US 10yr note futures are down -0.036% at 129-08, S&P 500 futures are down -0.09% at 3140.25, Crude oil futures are up 0.53% at $59.07, Gold futures are up 0.44% at $1481.5, DXY is up 0.03% at 97.161, CAD/USD is up 0.05% at 0.7588.

Cda Benchmarks	Yield	Tsy Benchmarks	Yield
2 Year	1.658%	2 Year	1.603%
5 Year	1.595%	5 Year	1.635%
10 Year	1.582%	10 Year	1.795%
30 Year	1.68%	30 Year	2.233%

US Economic Data

08:30 AM	PPI Final Demand MoM, Nov  Survey: 0.20%  Prior: 0.40%
	PPI Ex Food and Energy MoM, Nov  Survey: 0.20%  Prior: 0.30%
	PPI Final Demand YoY, Nov  Survey: 1.30%  Prior: 1.10%
	PPI Ex Food and Energy YoY, Nov  Survey: 1.70%  Prior: 1.60%
	Initial Jobless Claims, Dec 7  Survey: 214k  Prior: 203k
	Continuing Claims, Nov 30  Survey: 1678k  Prior: 1693k
09:45 AM	Bloomberg Consumer Comfort, Dec 8  Survey: —  Prior: 61.7
12:00 PM	Household Change in Net Worth, 3Q  Survey: —  Prior: $1830b

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