Commentaires
14/12/2017
Market Update
Tsys weaker, yields 2-3bps higher, 10Y 2.37% (+2.8bps) – , yield curve slightly flatter, little reaction to stronger Nov retail sales (0.8% vs 0.3%). In Europe UK gilts outperforming, gilt/bund spread at a three-month low 87 bps – the March gilt future spiked to intra day high 125.18 well after BOE decision to leave rates unch despite a very strong read on Nov UK retail sales 1.1% vs 0.4%. Bunds under pressure as flash PMI data from France and Germany came in better than exp. GOCs better offered after 8:30 US data, Can/US 1bp tighter after yesterday’s 4bp post FOMC widening.
News headlines
Fed Raises Rates, Eyes Three 2018 Hikes as Yellen Era Nears End (Bloomberg) Federal Reserve officials followed through on an expected interest-rate increase and raised their forecast for economic growth in 2018, even as they stuck with a projection for three hikes in the coming year.
Carney in Holding Pattern on Interest Rates After November Hike (Bloomberg) The Bank of England will fall into a central banking holding pattern on Thursday after November saw the first interest-rate hike in a decade.
Two GOP Senators Slam Tax Cuts for Rich, But How Will They Vote? (Bloomberg) President Donald Trump insisted Wednesday that his tax cut is all about helping the middle class even as Republican leaders formed a last-minute plan to cut the top rate paid by million-dollar earners.
Euro-Area Activity Surges as Manufacturing Posts Record Growth (Bloomberg) Economic momentum in the euro area unexpectedly accelerated to the fastest pace in almost seven years as manufacturing posted record growth at the end of 2017. A composite Purchasing Managers’ Index rose to 58 in December from 57.5 in November, IHS Markit said. Economists surveyed by Bloomberg predicted a decline to 57.2. An index for Germany, the region’s biggest economy, jumped to the highest since 2011.
European Stocks Down, Euro Steady After ECB Holds: Markets Wrap (Bloomberg) Stocks stayed lower, while the euro and core European bonds held steady after the European Central Bank left its key rate unchanged and maintained its pledge to move slowly in winding down euro-area stimulus.
U.K. Retailers Get Black Friday Boost as Sales Jump 1.1% (Bloomberg) Black Friday gave U.K. retailers a stronger-than-expected boost last month as discounts spurred Britons to snap up electrical appliances and other household products.
Walt Disney buys Murdoch’s Fox for $52.4bn (BBC) Walt Disney says it is to buy 21st Century Fox’s entertainment assets for a total $52.4bn (£39bn). The deal includes Fox’s 39% stake in satellite broadcaster Sky, and the 20th Century Fox film studio, Disney announced. Fox’s remaining assets, including Fox News and Sports, will form a new company.
Canadian home prices fall again in November: Teranet (Reuters) Canadian home prices fell again in November, the third straight monthly decline and the largest November drop outside of a recession, as Toronto prices fell for the fourth month and Vancouver prices were flat, data showed on Wednesday
Bombardier forecasts 2018 revenue below analysts’ estimates (Reuters) Canadian plane and train maker Bombardier Inc, in the middle of a five-year plan to turn around its ailing business, on Thursday forecast 2018 revenue that came in well short of analysts’ estimates.
Overnight markets
Overview: US 10yr note futures are down -0.113% at 124-15, S&P 500 futures are up 0.07% at 2671, Crude oil futures are down -0.44% at $56.35, Gold futures are up 0.89% at $1259.7, DXY is down -0.08% at 93.355, CAD/USD is up 0.1% at 0.7795.
| Cda Benchmarks | Yield | Tsy Benchmarks | Yield |
| 2 Year | 1.52% | 2 Year | 1.803% |
| 5 Year | 1.672% | 5 Year | 2.133% |
| 10 Year | 1.859% | 10 Year | 2.364% |
| 30 Year | 2.171% | 30 Year | 2.738% |
US Economic Data
| 8:30 AM | Initial Jobless Claims, Dec 9th est 236k (236k prior) |
| Continuing Claims, Dec 2nd est 1900k (1908k prior) | |
| Retail Sales Advance MoM, Nov est 0.3% (0.2% prior) | |
| Retail Sales Ex Auto MoM, Nov est 0.6% (0.1% prior) | |
| Retail Sales Ex Auto and Gas, Nov est 0.4% (0.3% prior) | |
| Import Price Index MoM, est 0.7% (0.2% prior) | |
| Import Price Index Ex Petroleum, Nov est 0.1% (0.1% prior) | |
| Import Price Index YoY, Nov est 3.2% (2.5% prior) | |
| Export Price Index MoM, Nov est 0.3% (0.0% prior) | |
| 9:45 AM | Markit US Manufacturing PMI, Dec est 53.9 (53.9 prior) |
| Markit US Services PMI, Dec est 54.7 (54.5 prior) | |
| Markit US Composite PMI, Dec (54.5 prior) | |
| Bloomberg Consumer Comfort, Dec 10th (52.3 prior) | |
| 10:00 AM | Business Inventories, Oct est -0.1% (0.0% prior) |
Canadian Economic Data
| 8:30 AM | New Housing Price Index MoM, Oct est 0.2% (0.2% prior) |
| New Housing Price Index YoY, Oct (3.8% prior) | |
| 9:00 AM | Existing Home Sales MoM, Nov (0.9% prior) |
| Bloomberg Dec. Canada Economic Survey |
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, Hugues Savard
Institutional Bond and Equity Desk
CTI Capital Valeurs Mobilières Inc.
Tel : (514)-861-0240
Fax: (514)-861-3230
13/12/2017
Market Update
Tsys weakening before CPI , lows of overnight range, yields 1.2-2bps higher, 10Y 2.42 (+2bps). Brief bid on democrat win in Alabama senate race evaporated the rest of the session. CPI coming up and FOMC meeting later this aft with the Fed expected to hike rates , but focus on new dotplots and final Yellen press conference. Core Euro bonds lower, led by 10Y bunds, spking lower with gilts ~5:30 after mixed UK labor data – rise in AWE yet weaker employment, which could lead to higher gilt issuance on lower tax receipts. GOCs weaker in line with tsys, 10Y 1.895%. CMB 5 yr pricing this morning in the area of 32bps- mkt has improved 31.5/31 (32/31.5 yest). 10Y provi supply possible from Ont and Newf.
News headlines
Fed 2018 Dots in Focus for Yellen Swan Song: Decision Day Guide (Bloomberg) As investors await 2018 direction from Federal Reserve chairman nominee Jerome Powell, they will get one last chance to hear Janet Yellen’s take on the U.S. economy.
Democrat Doug Jones Defeats GOP’s Roy Moore in Alabama Senate Race (Bloomberg) Democrat Doug Jones delivered a stunning upset defeat to Republican Roy Moore in a U.S. Senate race in deep-red Alabama that had split the GOP even before its controversial nominee was accused of inappropriate conduct with teenage girls.
U.K. Loses Most Jobs Since 2015 as Labor Market Shows Strain (Bloomberg) Britain shed jobs at the fastest pace in almost 2 1/2 years between August and October in a sign that the labor market is slowing.
Stocks Struggle Ahead of Fed Meeting; Bonds Fall: Markets Wrap (Bloomberg) Stocks in Europe struggled to match Asian gains as investors awaited policy decisions by central banks on the continent and in America. Most European bonds followed Treasuries lower as the dollar retreated.
Investor Bet on Middle East Oil Play Pays Off in Abu Dhabi IPO (Bloomberg) Investors who bet on exposure to Middle East oil got it right, at least on the first trading day of shares in a unit of Abu Dhabi’s oil giant.
Canada’s CIBC plans U.S. listing of $2 billion Caribbean unit (Reuters) Canadian Imperial Bank of Commerce CM.TO plans to list its $2 billion Caribbean unit, FirstCaribbean, in New York, enabling it to exit a region where earnings growth has been slow, three people familiar with the matter told Reuters this week.
West Face files claim against mortgage lender Home Capital (Financial Post) Alternative asset manager West Face Capital Inc. has formally filed a lawsuit against Home Capital Group Inc. and three former executives, seeking $70 million in damages over claims the mortgage lender’s public disclosure was “inaccurate, incomplete and misleading.”
Overnight markets
Overview: US 10yr note futures are down -0.176% at 123-29, S&P 500 futures are down 0% at 2667.75, Crude oil futures are up 0.93% at $57.67, Gold futures are up 0.15% at $1243.6, DXY is down -0.07% at 94.039, CAD/USD is down -0.05% at 0.7777.
| Cda Benchmarks | Yield | Tsy Benchmarks | Yield |
| 2 Year | 1.54% | 2 Year | 1.848% |
| 5 Year | 1.704% | 5 Year | 2.197% |
| 10 Year | 1.893% | 10 Year | 2.425% |
| 30 Year | 2.187% | 30 Year | 2.796% |
US Economic Data
| 7:00 AM | MBA Mortgage Applications, Dec 8th -2.3% (4.7% prior) |
| 8:30 AM | CPI MoM, Nov est 0.4% (0.1% prior) |
| CPI Ex Food and Energy MoM, Nov est 0.2% (0.2% prior) | |
| CPI YoY, Nov est 2.2% (2.0% prior) | |
| CPI Ex Food and Energy YoY, est 1.8% (1.8% prior) | |
| CPI Core Index SA, Nov est 253.932 (253.428 prior) | |
| CPI Index NSA, Nov est 246.816 (246.663 prior) | |
| Real Avg Weekly Earnings YoY, Nov (0.4% prior) | |
| Real Avg Hourly Earnings YoY, Nov (0.4% prior) | |
| 14 :00 PM | FOMC Rate Decision (Upper Bound), Dec 13th est 1.50% (1.25% prior) |
| FOMC Rate Decision (Lower Bound), Dec 13th est 1.25% (1.00% prior) |
Canadian Economic Data
| 8:30 AM | Teranet/National Bank HPI MoM, Nov (-1.0% prior) |
| Teranet/National Bank HPI YoY, Nov (10.0% prior) | |
| Teranet/National Bank HP Index, Nov (218.13 prior) |
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, Hugues Savard
Institutional Bond and Equity Desk
CTI Capital Valeurs Mobilières Inc.
Tel : (514)-861-0240
Fax: (514)-861-3230
12/12/2017
Market Update
Tsys trading slightly weaker, yields ~0.5-1bp higher US 10Y 2.38%, light volume in TY futures (~250k). Thirty year auction in the US, FOMC decision tommorow aft. Core Euro govts lower on stronger UK inflation data after CPI rose to the highest level in five and a half years in Nov. GOCs weaker after stronger US PPI, spds 1-2bps wider vs tsys. Provis unch, Ont 48s 69.5/69, Ont 27s 60/5, longs continue to outperform on extension flows.
News headlines
Carney to Put Pen to Paper as U.K. Inflation Climbs Above 3% (Bloomberg) U.K. inflation unexpectedly accelerated to the fastest in more than 5 1/2 years in November, which will force Bank of England Governor Mark Carney to explain why price growth is so far above his policy target.
Crack in U.K. Oil Pipe Roils Crude Trading From U.S. to Asia (Bloomberg) The effects of a hairline crack in one of the world’s most important oil conduits is rippling through crude markets from Europe to the U.S. and Asia.
Moore, Jones Expose Rural-Urban Divide That Defines Alabama Race (Bloomberg) Democrat Doug Jones and Republican Roy Moore made their election eve pitches to Alabama voters in settings that evoked the cultural and political divide that’s come to define the two parties in modern America.
Atos Bids $5.1 Billion for Gemalto to Create French Tech Giant (Bloomberg) Atos SE made a 4.3-billion-euro ($5.06 billion) unsolicited bid for Gemalto NV with the backing of the French state’s investment bank, seeking to create a European leader in cybersecurity, digital technologies and payment services.
Stocks Push Higher as Oil Rises; Dollar Slips: Markets Wrap (Bloomberg) Stocks in Europe gained, while the dollar slipped and Treasuries steadied as the week’s central-bank meetings remained the focus for market participants.
Bond Traders Look to 2018 as This Week’s Fed Raise Seen as Done Deal (Bloomberg) With a Federal Reserve rate hike this week seen as a done deal, the best chance for bond-market volatility may lie in policy makers’ updated outlook for the pace of future tightening.
Canada beefing up housing data as policy pushes ahead (Reuters) Fresh data on foreign investment in Toronto and Vancouver, Canada’s largest cities, will be released next week in a move economists hope will shed light on what is driving demand – and a potential bubble – in the country’s housing market.
Canada, provinces end dispute on how to split pot tax revenues (Reuters) The Canadian government and the country’s 10 provinces on Monday settled a disagreement on how to split the revenues from a proposed federal tax on marijuana sales once the narcotic drug is legalized next July, Finance Minister Bill Morneau said.
Overnight markets
Overview: US 10yr note futures are down -0.038% at 124-07, S&P 500 futures are up 0.08% at 2666.75, Crude oil futures are up 0.9% at $58.51, Gold futures are down -0.14% at $1245.1, DXY is up 0.01% at 93.872, CAD/USD is down -0.19% at 0.7793.
| Cda Benchmarks | Yield | Tsy Benchmarks | Yield |
| 2 Year | 1.525% | 2 Year | 1.835% |
| 5 Year | 1.689% | 5 Year | 2.167% |
| 10 Year | 1.882% | 10 Year | 2.394% |
| 30 Year | 2.175% | 30 Year | 2.779% |
US Economic Data
| 6:00 AM | NFIB Small Business Optimism, Nov 107.5 est 104.0 (103.8 prior) |
| 8:30 AM | PPI Final Demand MoM, Nov 0.4% est 0.3% (0.4% prior) |
| PPI Ex Food, Energy, Trade MoM, Nov 0.4% est 0.2% (0.2% prior) | |
| PPI Ex Food and Energy MoM, Nov 0.4% est 0.2% (0.4% prior) | |
| PPI Final Demand YoY, Nov 3.1% est 2.9% (2.8% prior) | |
| PPI Ex Food and Energy YoY, Nov 2.4% est 2.4% (2.4% prior) | |
| PPI Ex Food, Energy, Trade YoY, Nov 2.4% (2.3% prior) | |
| 14:00 PM | Monthly Budget Statement, Nov est -134.5b (-136.7b prior) |
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, Hugues Savard
Institutional Bond and Equity Desk
CTI Capital Valeurs Mobilières Inc.
Tel : (514)-861-0240
Fax: (514)-861-3230