Commentaires matinaux

Market Update

US tsys rallying since mid-morning, 10Y 1.785% (-3.5bps), heavy volume in TY futures (600k). Tsy prices were drifting lower until Trump comments ~5:00ET that the China deal might have to wait until after the 2020 presidential election.  Stock futures at the lows, S&P -22 (-0.70%), Dow -245, crude -0.60%. Core Euro bonds higher, lagging the move in tsys by 1bp in 10s.   GOCs higher, 10Y 3bps lower 1.495%. BOC tomorrow – no change in rates or outlook expected.  Data have come in close to expectations, capped off by last week’s 1.3% increase in Q3 GDP which showed resilience in both consumer spending and business investment.

News headlines

U.S. Stock Futures Drop as Trump Dents Trade Hopes: Markets Wrap (Bloomberg) U.S. equity futures retreated and stocks in Europe erased a gain as President Donald Trump said he might wait up to a year to complete a trade accord with China. Safe-haven assets climbed.

TSX futures fall after Trump hints at delay in U.S.-China trade deal (Reuters) Canada’s main stock index futures fell on Tuesday, after U.S. President Donald Trump said he had no deadline for reaching a trade agreement with China, adding it could come after the U.S. presidential election in November 2020.

Oil Falls as Trump Signals Long Wait for U.S.-China Trade Deal (Bloomberg) Oil slipped below $56 as U.S. President Donald Trump said there may be a long wait for a trade agreement with China, casting doubt about the strength of demand just days before the OPEC+ meeting.

Trump says China trade deal might have to wait for 2020 election (Reuters) U.S. President Donald Trump said a trade agreement with China might have to wait until after the U.S. presidential election in November 2020, denting hopes of a quick resolution to a dispute that has weighed on the world economy.

France and EU say primed to retaliate over U.S. tariff threat (Reuters) France and the European Union said on Tuesday they are ready to retaliate if U.S. President Donald Trump acts on a threat to impose duties of up to 100% on imports of champagne, handbags and other French products worth $2.4 billion.

Trump says new U.S. law on Hong Kong doesn’t help China trade talks (Reuters) U.S. President Donald Trump said on Monday U.S. legislation backing protesters in Hong Kong did not make trade negotiations with China easier, but added he believes Beijing still wants a deal with the United States.

European shares whacked lower as Trump says China trade deal may come only after Nov 2020 election (Reuters) European shares fell back into the red on Tuesday, abandoning earlier efforts to claw their way back from three days of falls, as U.S. President Donald Trump said a trade deal with China might be delayed until after November 2020 elections.

Trump, citing U.S. farmers, slaps metal tariffs on Brazil, Argentina (Reuters) U.S. President Donald Trump ambushed Brazil and Argentina on Monday, announcing tariffs on U.S. steel and aluminum imports from the two countries in a measure that shocked South American officials and left them scrambling for answers.

Japan preparing $120 billion stimulus package to bolster fragile economy (Reuters) Japan is preparing an economic stimulus package worth $120 billion to support fragile growth, two government officials with direct knowledge of the matter said on Tuesday, and complicating government efforts to fix public finances.

Market Overview: US 10yr note futures are up 0.339% at 129-11, S&P 500 futures are down -0.59% at 3095.75, Crude oil futures are down -0.57% at $55.64, Gold futures are up 0.45% at $1475.8, DXY is down -0.06% at 97.799, CAD/USD is up 0.08% at 0.7508.

Cda Benchmarks	Yield	Tsy Benchmarks	Yield
2 Year	1.581%	2 Year	1.572%
5 Year	1.511%	5 Year	1.606%
10 Year	1.5%	10 Year	1.784%
30 Year	1.596%	30 Year	2.234%

US Economic Data

12/03

Wards Total Vehicle Sales, Nov  Survey: 16.90m  Prior: 16.55m

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 sharply lower, heavy volume in TY futures (685k), 10Y 1.835% (+6bps), the selloff concentrated at the longer end of the curve with 2s30s 5bps wider. Better than expected China PMIs seen driving weakness in tsys and EGBs – China Manufacturing PMI rose to 50.2 in Nov, the first expansionary reading since April. US equity futures giving up gains since early NA trading, S&P +2.5 from +13 earlier. Focus on the ISM Manufacturing Index at 10:00ET. GOCs lower, underperforming tsys by 2bps out to 10yrs. BOC meeting on Wed, no change in rates exp (<5% odds of cut), we do not see any change in the outlook – Q3 GDP was on consensus  with surprising strength in consumption and domestic demand, while policy remains accomodative

News headlines

U.S. Stock Futures Trim Gains on Trump Tariff Move: Markets Wrap (Bloomberg) U.S. equity futures pared a gain and Europe stocks turned lower as a move on tariffs by America overshadowed solid factory data and reminded investors of lingering trade risks. Government bonds slid.

CANADA STOCKS-TSX futures rise on higher oil prices (Reuters) Futures for Canada’s main stock index were higher on Monday, as oil prices rose, supported by hints that OPEC and its allies may agree to deepen output cuts at a meeting this week.

Trump says he will restore tariffs on Brazil, Argentina metal imports (Reuters) U.S. President Donald Trump on Monday said he would immediately restore tariffs on U.S. steel and aluminum imports from Brazil and Argentina, prompting at least one counterpart to vow talks with the Republican president.

Euro zone factory activity shrank in November but worst may be over: PMI (Reuters) Euro zone manufacturing activity contracted for a 10th straight month in November although the bloc’s battered factories may have turned a corner as forward-looking indicators in Monday’s survey appear to have passed a nadir.

U.S. dollar at six-month highs vs yen, NZ dollar shines after upbeat China data (Reuters) The U.S. dollar scaled a six-month high versus the Japanese yen and New Zealand’s currency jumped to near four-month peaks on Monday after an unexpected rebound in Chinese manufacturing activity lifted hopes of a brighter outlook for world growth.

Oil Rebounds on Speculation That OPEC+ Could Deepen Output Cuts (Bloomberg) Oil rebounded from the biggest weekly loss since October on speculation that OPEC+ could defy expectations by deepening its production cuts.

Saudi Arabia wants OPEC+ to deepen oil cuts due to Aramco IPO (Reuters) OPEC and its allies plan to deepen oil cuts and have the deal in place so it runs at least until June 2020 as Saudi Arabia wants to deliver a positive surprise to the market before the listing of Saudi Aramco, two sources familiar with the talks said.

Market Overview: US 10yr note futures are down -0.338% at 128-30, S&P 500 futures are up 0.1% at 3146.75, Crude oil futures are up 1.99% at $56.27, Gold futures are down -0.5% at $1465.4, DXY is down -0.03% at 98.248, CAD/USD is up 0.13% at 0.752.

Cda Benchmarks	Yield	Tsy Benchmarks	Yield
2 Year	1.62%	2 Year	1.624%
5 Year	1.55%	5 Year	1.662%
10 Year	1.537%	10 Year	1.829%
30 Year	1.623%	30 Year	2.268%

US Economic Data

09:45 AM	Markit US Manufacturing PMI, Nov F  Survey: 52.2  Prior: 52.2
10:00 AM	ISM Manufacturing, Nov  Survey: 49.2  Prior: 48.3
	ISM Prices Paid, Nov  Survey: 47.0  Prior: 45.5
	ISM New Orders, Nov  Survey: —  Prior: 49.1
	Construction Spending MoM, Oct  Survey: 0.40%  Prior: 0.50%

Canadian Economic Data

08:30 AM	MLI Leading Indicator MoM, Oct  Survey: — Actual: 0.40% Prior: 0.20%
09:30 AM	Markit Canada Manufacturing PMI, Nov  Survey: —  Prior: 51.2
10:00 AM	Bloomberg Nanos Confidence, Nov 29  Survey: —  Prior: 55.0

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 tsy yields slightly higher, 10Y 1.77%, heavier volume in TY futures due to ongoing roll (485k), S&P futures -6.0.  Bunds/gilts higher, gilts rallying with the long end outperforming curve 3bps flatter. GOCs outperforming US by 1-2bps before Q3 GDP (1.3% exp).  With  BOC next week, GDP figures likely to figure prominently in decision. Recent CPI, retail sales and manufacturing sales were all in line or stronger (retail sales on a quarterly basis)  suggesting GDP would need to come materially weaker to move the needle for a rate cut next week (~5% priced in)

News headlines

U.S. Futures Slip as Stocks Struggle; Bonds Drift: Markets Wrap (Bloomberg) U.S. equity futures fell with stocks in Asia while European shares struggled for traction, signaling a lackluster finale to the third straight month of gains for major global benchmarks. The dollar was steady.

TSX futures lower ahead of GDP data (Reuters) Futures for Canada’s main stock index inched lower on Friday, ahead of the country’s gross domestic product data due later in the day.

Oil Set for Fourth Weekly Advance Ahead of Key OPEC+ Meeting (Bloomberg) Oil is heading for a fourth weekly gain, the longest winning streak since April, before a key OPEC+ meeting next week that will set the path for future production cuts.

U.S. shoppers stay away from stores, spend online as Black Friday begins (Reuters) U.S. consumers splurged more than $2 billion online in the first hours of Thanksgiving shopping on Thursday, while crowds were largely thin at retailers on the eve of Black Friday, reflecting the broader trend away from shopping at brick-and-mortar stores.

Explainer: What’s at stake in Macron’s reform of France’s cherished pensions? (Reuters) France is bracing for nationwide public sector strikes on Dec. 5 against President Emmanuel Macron’s drive to overhaul the country’s unwieldy and costly pension system.

Italy and Germany vie for ECB’s money-printing press: sources (Reuters) The German and Italian appointees to the European Central Bank’s board are vying for control of the ECB’s market operations, a key position that involves running its vast money-printing program, two sources told Reuters.

Sterling range-bound until election; two-week volatility jumps (Reuters) The pound hovered around $1.29 on Friday, showing little reaction to political headlines, with analysts expecting little movement in the run-up to the UK general election on Dec. 12.

Market Overview: US 10yr note futures are down -0.06% at 129-13, S&P 500 futures are down -0.19% at 3147.75, Crude oil futures are down -0.05% at $58.08, Gold futures are down -0.07% at $1459.8, DXY is up 0.12% at 98.488, CAD/USD is up 0.17% at 0.7516.

Cda Benchmarks	Yield	Tsy Benchmarks	Yield
2 Year	1.589%	2 Year	1.628%
5 Year	1.496%	5 Year	1.631%
10 Year	1.452%	10 Year	1.769%
30 Year	1.56%	30 Year	2.19%

US Economic Data

There is no US economic data for today.

Canadian Economic Data

08:30 AM	Quarterly GDP Annualized, 3Q  Survey: 1.30% Actual: 1.30%  Prior: 3.70%
	GDP MoM, Sep  Survey: 0.10% Actual: 0.10% Prior: 0.10%
	GDP YoY, Sep  Survey: 1.40% Actual: 1.60%  Prior: 1.30%
	Industrial Product Price MoM, Oct  Survey: 0.00% Actual: 0.10%  Prior: -0.10%
	Raw Materials Price Index MoM, Oct  Survey: -2.00% Actual: -1.90%  Prior: 0.00%

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