Commentaires matinaux

Market Update

US tsys trading higher before US jobs data, 10Y 1.795% (-2bps), avg volume in TY futures (350k). UK gilts leading EGBs higher, IPSOS poll shows narrowing conservative lead over labour before tonite’s final Johnson/ Corbyn debate. US payrolls forecast at 180k last month vs 128k Oct, the resolution of the GM strike expected to add 50k to the total figure. GOCs higher, in line with tsys, yields across the curve close to late Oct/Nov highs. Cdn employment expected to have rebounded 10k in Nov after 1.8k decline in Oct. Wages in the spotlight as well after October’s strong 4.4% gain. BOC deputy Lane yesterday noted the domestic economy remains resilient despite the impact from trade wars, while economic growth was evolving as expected.

News headlines

Stocks Advance With Bonds Before U.S. Jobs Data: Markets Wrap (Bloomberg) Stocks climbed alongside S&P 500 futures on Friday as investors counted down to U.S. jobs data and watched for any further developments ahead of the looming tariff deadline between America and China. Bonds also advanced.

TSX futures rise on trade optimism (Reuters) Futures for Canada’s main stock index edged up on Friday, as comments from U.S. President Donald Trump that trade talks with China were “moving right along” lifted investor sentiments.

Oil Near $58 as Traders Await Details on How OPEC+ Shares Cuts (Bloomberg) Oil traded near $58 a barrel as the market awaited crucial details on how OPEC+ will distribute cuts among its members.

Returning General Motors workers seen boosting U.S. November payrolls (Reuters) U.S. job growth likely accelerated in November as former striking workers returned to General Motors’ (GM.N) payrolls, which would confirm that the economy remained on a moderate expansion path despite a prolonged manufacturing slump.

Fed voters a less-hawkish bunch in 2020, lowering bar for U.S. rate cut (Reuters) The bar for cutting U.S. interest rates may get a little lower next year when a new crop of central bankers rotate into voting spots on the Federal Reserve’s policy-setting panel as part of its annual membership reshuffle.

Saudi, Russia win over oil producers to deeper cuts (Reuters) Saudi Arabia and Russia won backing for deeper output cuts from OPEC and allied oil producers on Friday as they look to head off global oversupply in 2020 and sustain prices.

China to waive tariffs on some U.S. soybeans, pork in goodwill gesture (Reuters) In a positive gesture, China said on Friday that it will waive import tariffs for some soybeans and pork shipments from the United States, as the two sides try to thrash out a broader agreement to defuse their protracted trade war.

World Bank adopts $1 billion-plus annual China lending plan over U.S. objections (Reuters) The World Bank on Thursday adopted a plan to aid China with $1 billion to $1.5 billion in low-interest loans annually through June 2025, despite the objections of U.S. Treasury Secretary Steven Mnuchin.

Canada’s bankers face the bleakest bonus year in almost a decade (BNN) For Canadian bankers, 2019 shaped up to be the worst year for bonuses in close to a decade.

Market Overview: US 10yr note futures are down 0% at 129-10, S&P 500 futures are up 0.18% at 3123.25, Crude oil futures are down -0.24% at $58.29, Gold futures are down -0.16% at $1480.7, DXY is up 0.02% at 97.433, CAD/USD is down 0% at 0.759.

Cda Benchmarks	Yield	Tsy Benchmarks	Yield
2 Year	1.674%	2 Year	1.587%
5 Year	1.623%	5 Year	1.618%
10 Year	1.596%	10 Year	1.795%
30 Year	1.679%	30 Year	2.238%

US Economic Data

08:30 AM	Change in Nonfarm Payrolls, Nov  Survey: 180k  Prior: 128k
	Change in Private Payrolls, Nov  Survey: 178k  Prior: 131k
	Change in Manufact. Payrolls, Nov  Survey: 40k  Prior: -36k
	Unemployment Rate, Nov  Survey: 3.60%  Prior: 3.60%
	Average Hourly Earnings MoM, Nov  Survey: 0.30%  Prior: 0.20%
	Average Hourly Earnings YoY, Nov  Survey: 3.00%  Prior: 3.00%
	Labor Force Participation Rate, Nov  Survey: —  Prior: 63.30%
10:00 AM	Wholesale Inventories MoM, Oct F  Survey: 0.20%  Prior: 0.20%
	Wholesale Trade Sales MoM, Oct  Survey: —  Prior: 0.00%
	U. of Mich. Sentiment, Dec P  Survey: 97.0  Prior: 96.8

Canadian Economic Data

08:30 AM	Part Time Employment Change, Nov  Survey: 15.0  Prior: 14.3
	Full Time Employment Change, Nov  Survey: 10.0  Prior: -16.1
	Net Change in Employment, Nov  Survey: 10.0k  Prior: -1.8k
	Unemployment Rate, Nov  Survey: 5.50%  Prior: 5.50%
	Hourly Wage Rate Permanent Employees YoY, Nov  Survey: 4.50%  Prior: 4.40%
	Participation Rate, Nov  Survey: 65.7  Prior: 65.7

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 weaker on avg volume (375k TY fut), 10Y 1.78%,  US equity futures extending gains since early NA trading, S&P +10, Nasdaq +34.  Crude higher for a 4th day, OPEC discussing extending cuts of 1.2mln bbls/day by more than 400k as well as extending the agreement from March to June. German bunds lower despite surprise decline in Oct factory orders (-0.4% vs 0.4% exp), the absolute level of orders close to the lowest since 2016. GOCs continuing underperformance vs tsys post hawkish BOC yest, Can/US 5-7bps wider.  In the near term, resilience in consumption and business demand lessen the pressure for the BOC to offset concerns over trade, while lower longer term mortgage rates continue to support housing demand.

News headlines

U.S. Futures, Stocks Advance as Bonds Edge Lower: Markets Wrap (Bloomberg) U.S. equity-index futures rose with European and Asian stocks on Thursday as investors maintained their fragile confidence that America could scrap a scheduled tariff hike on Chinese imports in 10 days. Bonds and the dollar edged lower.

TSX futures rise as oil prices gain (Reuters) Canada’s main stock index futures rose on Thursday, helped by gains in oil prices ahead of an OPEC meeting where members are expected to agree on increasing production cuts.

Oil Holds Gain as OPEC Ministers Gather for Vienna Meeting (Bloomberg) Oil held its biggest surge in more than two months as OPEC ministers gather in Vienna to discuss output cuts.

Gazing into the recession crystal ball (Reuters) The protracted trade war between China and the United States and a deteriorating global growth outlook have left investors nervous that the longest expansion in American history is at risk of ending.

Japan launches $122 billion stimulus to fight trade risks, post-Olympic slump (Reuters) Japan’s cabinet approved a $122 billion fiscal package on Thursday to support stalling growth in the world’s third-largest economy amid offshore risks and as policymakers look to sustain activity beyond the 2020 Tokyo Olympics.

China maintains tariffs must be reduced for phase one trade deal with U.S. (Reuters) Tariffs must be cut if China and the United States are to reach an interim agreement on trade, the Chinese commerce ministry said on Thursday, sticking to its stance that some U.S. tariffs must be rolled back for a phase one deal.

World food prices surge in November, lifted by meat, vegetable oils: U.N. FAO (Reuters) World food prices rose strongly in November, lifted by big jumps in prices of meat and vegetable oils, despite slightly lower cereals prices, the United Nations food agency said on Thursday.

Wall Street’s high-stake bets on calm less risky than they seem (Reuters) At a glance, a near-record accumulation of speculative bets on market tranquility looks like it couldn’t have come at a worse time.

CIBC quarterly profit misses estimates on higher loan loss provisions (Reuters) Canadian Imperial Bank of Commerce (CM.TO) reported quarterly profit that fell short of analysts’ estimates on Thursday, hurt by higher provision for bad loans and slower growth at its domestic banking business.

Market Overview: US 10yr note futures are up 0.06% at 129-16, S&P 500 futures are up 0.26% at 3119, Crude oil futures are up 0.34% at $58.63, Gold futures are up 0.21% at $1483.3, DXY is down -0.18% at 97.474, CAD/USD is down -0.24% at 0.7593.

Cda Benchmarks	Yield	Tsy Benchmarks	Yield
2 Year	1.638%	2 Year	1.568%
5 Year	1.579%	5 Year	1.595%
10 Year	1.556%	10 Year	1.771%
30 Year	1.635%	30 Year	2.223%

US Economic Data

07:30 AM	Challenger Job Cuts YoY, Nov  Survey: —  Actual: -16.00% Prior: -33.50%
08:30 AM	Initial Jobless Claims, Nov 30  Survey: 215k Actual: 203k  Prior: 213k
	Continuing Claims, Nov 23  Survey: 1660k Actual: 1693k Prior: 1640k
	Trade Balance, Oct  Survey: -$48.5b Actual: -47.2b  Prior: -$52.5b
09:45 AM	Bloomberg Consumer Comfort, Dec 1  Survey: —  Prior: 60.5
10:00 AM	Factory Orders, Oct  Survey: 0.30%  Prior: -0.60%
	Durable Goods Orders, Oct F  Survey: 0.60%  Prior: 0.60%
	Durables Ex Transportation, Oct F  Survey: 0.60%  Prior: 0.60%
	Cap Goods Orders Nondef Ex Air, Oct F  Survey: —  Prior: 1.20%
	Cap Goods Ship Nondef Ex Air, Oct F  Survey: —  Prior: 0.80%

Canadian Economic Data

08:30 AM	Int’l Merchandise Trade, Oct  Survey: -1.45b Actual: -1.08b  Prior: -0.98b
10:00 AM	Ivey Purchasing Managers Index SA, Nov  Survey: —  Prior: 48.2

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 weaker but off the lows after weak ADP (67k vs 135k), US 10Y 1.74% (+2.5bps), heavy volume in TY futures (855k), S&P futures +14, crude +2% 57.20.  US & China have moved closer to phase 1 trade deal according to BN, despite Trump comments yest that deal could wait until after US election. Selloff in gilts, 10Y gilt/bund spd 3bps wider, polling data show consistent lead for Tories with prospect of majority govt (MNI). GOCs lower & 2bps wider vs tsys before BOC, despite consensus of no change in rates or outlook from October.

News headlines

Stocks Rebound on Fresh Hopes for U.S.-China Deal: Markets Wrap (Bloomberg) U.S. equity futures advanced with European stocks after a news report that China and America were moving closer to a trade deal, despite heated rhetoric. Treasuries slipped along with the dollar.

TSX futures rise on higher oil prices, BoC rate decision eyed (Reuters) Canada’s main stock index futures rose on Wednesday, as oil prices gained in the run-up to meetings where OPEC and its allies are expected to extend output cuts, while investors awaited the central bank’s decision on interest rates.

Bank of Canada likely to hold and remain an outlier (BNN) Bank of Canada Governor Stephen Poloz, one of the few central bankers to resist the global push toward easier monetary policy, will probably maintain his wait-and-see approach this week.

Oil Rallies on Renewed Trade Deal Prospects Before OPEC+ Meeting (Bloomberg) Oil gained as the U.S. and China were moving closer to a trade deal and before OPEC+ decides on its output-cut policy later this week.

China warns U.S. over Uighur bill, raising doubts over early trade deal (Reuters) China warned on Wednesday that U.S. legislation calling for a tougher response to Beijing’s treatment of its Uighur Muslim minority will affect bilateral cooperation, clouding prospects for a near-term deal to end a trade war.

A pricey French import goes mainstream in Democratic primary (Reuters) U.S. Senator Elizabeth Warren has carried the idea of a wealth tax onto the center stage of American politics, but the roots were planted far away, in a young French economist’s work unraveling the flow of money through global tax havens.

EU seeks talks with U.S. on French goods tariff threat, ready to act (Reuters) The European Union would prefer talks with the United States to discuss Washington’s threat of tariffs on French luxury goods, but is ready to take action if that fails, the head of the European Commission Ursula von der Leyen said on Wednesday.

OPEC gearing up for deeper oil cuts, Russia yet to agree (Reuters) OPEC is gearing up to deepen production cuts later this week but still needs to agree with allies such as Russia over details of a deal to support oil prices and head off a looming oil glut next year.

U.S. private sector job growth at six-month low in November: ADP (Reuters) U.S. private employers added the fewest jobs in six months in November, well shy of economists’ expectations, a report by a payrolls processor showed on Wednesday.

Explainer: ECB to soul-search over policy goals (Reuters) The European Central Bank will conduct an overarching review of its policy strategy soon, looking at everything from the definition of its inflation target to fighting climate change.

Market Overview: US 10yr note futures are down -0.24% at 129-23, S&P 500 futures are up 0.47% at 3105.5, Crude oil futures are up 1.78% at $57.1, Gold futures are down -0.07% at $1483.3, DXY is down -0.08% at 97.654, CAD/USD is down -0.16% at 0.7534.

Cda Benchmarks	Yield	Tsy Benchmarks	Yield
2 Year	1.579%	2 Year	1.554%
5 Year	1.517%	5 Year	1.57%
10 Year	1.494%	10 Year	1.745%
30 Year	1.592%	30 Year	2.195%

US Economic Data

07:00 AM	MBA Mortgage Applications, Nov 29  Survey: —  Actual: -9.20% Prior: 1.50%
08:15 AM	ADP Employment Change, Nov  Survey: 135k Actual: 67k Prior: 125k
09:45 AM	Markit US Services PMI, Nov F  Survey: 51.6  Prior: 51.6
	Markit US Composite PMI, Nov F  Survey: —  Prior: 51.9
10:00 AM	ISM Non-Manufacturing Index, Nov  Survey: 54.5  Prior: 54.7

Canadian Economic Data

08:30 AM	Labor Productivity QoQ, 3Q  Survey: 0.20% Actual: 0.20% Prior: 0.20%
10:00 AM	Bank of Canada Rate Decision, Dec 4  Survey: 1.75%  Prior: 1.75%

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