Comments

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

Market Update

US tsys slightly lower, yields 0.5bps higher in 10s, 10Y 1.745%, avg volume in TY futures (390k), S&P futures +3.25, crude unch 58.45.  Full data slate in the US before Thanksgiving holiday including Q3 GDP, claims and durable goods at 8:30ET. Core Euro bonds mostly flat, attention turns to YouGov MRP poll for UK election. German 5Y auction oversubscribed (1.95x vs 1.73x in Oct). GOCs slightly lower in line with tsys, news of strike settlement yest unlikely to impact GOCs, strike was relatively short lived. RRB auction today, reopening of the 0.5% 2050 for $700mln

News headlines

Stocks Rise With U.S. Index Futures; Dollar Steady: Markets Wrap (Bloomberg) U.S. equity futures edged up while stocks climbed globally as the risk-on mood that’s driven American benchmarks to record highs showed few signs of abating. The dollar was steady before the release of jobs and personal-spending data from the world’s biggest economy.

TSX futures gain on rising hopes of a trade deal (Reuters) Canada’s main stock index futures rose on Wednesday, as upbeat comments from President Donald Trump lifted hopes that the United States and China were close to a trade deal.

Oil Holds Steady as Trade-Deal Hopes Counter Rising Stockpiles (Bloomberg) Oil held steady as traders weighed hopes for a limited U.S.-China trade deal against a reported increase in American crude stockpiles.

China’s industrial profits post steepest fall in eight months (Reuters) Profits at China’s industrial firms shrank at their fastest pace in eight months in October, tracking sustained drops in producer prices and exports and underscoring slowing momentum in the world’s second-largest economy.

China front-loads $142 billion in 2020 local government bonds to spur growth (Reuters) China has brought forward 1 trillion yuan ($142.07 billion) of the 2020 local government special bonds quota to this year as it seeks to avert a sharper economic slowdown.

International stocks to outperform U.S. in 2020: investors (Reuters) Even though the U.S. stock market continues a record-breaking rally that has sent the benchmark S&P 500 index up nearly 25% for the year, investors appear to be looking elsewhere for better values in the year ahead.

Trump says China deal in ‘final throes’ as top officials speak (BNN) President Donald Trump declared Tuesday that talks with China on the first phase of a trade deal were near completion after negotiators from both sides spoke by phone, signaling progress on an accord in the works for nearly two years.

Canada’s biggest rail strike in a decade ends, backlogs could nag shippers (Reuters) Canada’s longest railroad strike in a decade ended on Tuesday as Canadian National Railway Co reached a tentative agreement with workers, but shippers warned it could take weeks before service bounces back to normal.

Market Overview: US 10yr note futures are down -0.048% at 129-20, S&P 500 futures are up 0.1% at 3147, Crude oil futures are up 0.15% at $58.5, Gold futures are down -0.19% at $1464.6, DXY is up 0.07% at 98.319, CAD/USD is down -0.01% at 0.7536.

US Economic Data

07:00 AM	MBA Mortgage Applications, Nov 22  Survey: —  Actual: 1.50% Prior: -2.20%
08:30 AM	GDP Annualized QoQ, 3Q S  Survey: 1.90% Actual: 2.1%  Prior: 1.90%
	Personal Consumption, 3Q S  Survey: 2.80% Actual: 2.9% Prior: 2.90%
	GDP Price Index, 3Q S  Survey: 1.70% Actual: 1.8% Prior: 1.70%
	Core PCE QoQ, 3Q S  Survey: 2.20% Actual: 2.1% Prior: 2.20%
	Durable Goods Orders, Oct P  Survey: -0.90% Actual: 0.6% Prior: -1.20%
	Durables Ex Transportation, Oct P  Survey: 0.10% Actual: 0.6% Prior: -0.40%
	Initial Jobless Claims, Nov 23  Survey: 221k Actual: 213k  Prior: 227k
	Continuing Claims, Nov 16  Survey: 1691k Actual: 1640k Prior: 1695k
09:45 AM	MNI Chicago PMI, Nov  Survey: 47.0  Prior: 43.2
	Bloomberg Consumer Comfort, Nov 24  Survey: —  Prior: 59.1
10:00 AM	Personal Income, Oct  Survey: 0.30%  Prior: 0.30%
	Personal Spending, Oct  Survey: 0.30%  Prior: 0.20%
	PCE Deflator MoM, Oct  Survey: 0.30%  Prior: 0.00%
	PCE Deflator YoY, Oct  Survey: 1.40%  Prior: 1.30%
	PCE Core Deflator MoM, Oct  Survey: 0.10%  Prior: 0.00%
	PCE Core Deflator YoY, Oct  Survey: 1.70%  Prior: 1.70%
	Pending Home Sales MoM, Oct  Survey: 0.20%  Prior: 1.50%
02:00 PM	U.S. Federal Reserve Releases Beige Book

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