Commentaires

Market Update

Tsys opening slightly lower after core PPI 0.3% vs 0.1% exp for May, after a low volume overnite session, US 10Y 2.22%, tsy curve 0.5bps steeper as longs lag in front of today’s 30Y auction and tomorrow’s FOMC. Equity futures +3.75, crude lower after giving up early gains -0.46% 45.87.  GOCs continuing where they left off post BOC Wilkins yest – flatter and lower, 2s another 4bps higher 0.88%, 5s +3bps longs unch as the mkt views a pre-emptive move by the BOC as constructive for inflation. The Cdn mkt was caught flat footed by Wilkins Hawkins speech, coming barely three weeks after the Bank noted that while consumer spending and housing sector are improving, inflation remains subdued and export growth still weakish. We are pushing forward our call for the first rate hike to the October meeting.

News headlines 

CANADA STOCKS-Futures up as oil gains on Saudi pledge to make cuts (Reuters) Stock futures pointed to a higher opening for Canada’s main stock index on Tuesday as oil rose on Saudi Arabia’s pledge to make sizable supply cuts in July. The world’s top oil exporter plans to curb volumes of crude to some Asian buyers and deepen cuts in allocation to the United States, as part of an OPEC-led agreement to prop up oil prices in an oversupplied market.

U.K. Inflation Rate Rises More Than Forecast to Four-Year High (Bloomberg) U.K. inflation resumed its upward march last month, accelerating more than forecast to the fastest pace in four years. An increase in prices for computer games, laptops and package holidays — partly reflecting the impact of the weaker pound — lifted the inflation rate to 2.9 percent, the highest since June 2013. Economists had forecast that it would remain at 2.7 percent.

Canadian dollar leaps after odds of a rate hike in Canada this year rise above 50% (Financial Post) The Canadian dollar climbed in an otherwise quiet trading day on Tuesday, hitting its highest level in nearly two months after comments from Canada’s central bank raised the prospect that interest rates could rise as soon as this year.

Record Foreign Sales Boost Returns For Canadian Provincial Bonds (Bloomberg) Canadian provinces are selling an unprecedented amount of bonds overseas, easing pressure on the domestic market and offering investors the highest annual return since 2014.

Deutsche Bank reaches $170 million Euribor-rigging settlement (Reuters) Deutsche Bank AG (DBKGn.DE) will pay $170 million to settle an investor lawsuit claiming it conspired with other banks to manipulate the benchmark European Interbank Offered Rate and related derivatives.

Bearish Bets on Home Capital Have Dropped to 20% (Bloomberg) Short sellers are easing pressure on Home Capital Group Inc. as speculation builds that Canada’s embattled alternative mortgage lender may be closer to a takeover of the company or refinancing its costly rescue loan.

Overnight markets 

Overview: US 10yr note futures are down -0.049% at 126-09, S&P 500 futures are up 0.23% at 2432, Crude oil futures are down -0.5% at $45.85, Gold futures are down -0.45% at $1263.2, DXY is down -0.11% at 97.031, CAD/USD is down -0.68% at 0.7556.

US Economic Data

Canadian Economic Data

There is no major economic data release 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, David Leclair-Legault

Institutional Bond and Equity Desk
CTI Capital Valeurs Mobilières Inc.

Tel : (514)-861-0240
Fax: (514)-861-3230

Market Update

Tsys slightly lower on low volume in TY futures, US 10Y 2.209, before FOMC Wednesday, key eco data (CPI, retail sales…)  and 3,10 & 30Y supply this week. Equites weaker, emini -6, gold higher, crude continuing higher from Friday, now up 1.57% on bullish outlook from Saudi Energy Min. GOCs mixed, short end lower, curve flatter as 5-10 yr yields ~0.5bps lower, GOC 10Y 1.42%. Provincial spreads closed 1bp wider last week, NB long deal @ 89.5 Friday adding to pressure on spds. CMB 5Y expected to be launched today, weve seen good expressions of interest , CMBs look cheap vs provis and have lagged the tightening.

News headlines 

Stock futures down as tech rout continues (Reuters) U.S. stock index futures were lower on Monday, with Nasdaq futures taking the biggest hit as investors locked in gains on the richly-valued technology sector. Technology stocks have been enjoying a record-setting rally, helped largely by strong quarterly earnings. The S&P 500 technology index .SPLRCT has risen 18.5 percent this year and is on track for its best yearly performance since 2014.

GE’s Immelt Steps Down Amid Trian Pressure as Flannery Named CEO (Bloomberg) Jeffrey Immelt is stepping down as chairman and chief executive of General Electric Co., ending a 16-year tenure during which he dramatically reshaped one of the world’s top manufacturers yet struggled to win the approval of Wall Street.

U.K.’s Hung Parliament Raises Business Hopes for a Softer Brexit (Bloomberg) Most business leaders are dismayed at the political chaos unleashed by the U.K. election, which left a damaged Prime Minister Theresa May trying to forge a shaky coalition government. But some are quietly hoping that it may lead to softer terms for the country’s exit from the European Union.

UK PM May’s Brexit plan has not changed, her spokesman says (Reuters) Britain’s plan for leaving the European Union has not changed, Prime Minister Theresa May’s spokesman said on Monday, despite a disastrous election gamble that has plunged British politics into chaos days before formal Brexit talks begin.

MIDEAST STOCKS-Qatari banks fall after UAE red flag; UAE’s Dana Gas, DSI rise (Reuters) June 11 Shares in Qatari banks fell on Sunday after the United Arab Emirates central bank ordered UAE banks to be wary of accounts which they hold with six Doha-based lenders, while Dana Gas and Drake & Scull outperformed in the UAE.

Encana and Centrica sell natural gas assets in deals worth $1.7 billion (Financial Post) A pair of natural gas deals worth a combined $1.7 billion were struck Friday and experts say more acquisitions and divestitures are expected in the sector as companies move to refocus their portfolios.

Overnight markets 

Overview: US 10yr note futures are down -0.074% at 126-11, S&P 500 futures are down -0.14% at 2424.75, Crude oil futures are up 1.7% at $46.61, Gold futures are down -0.14% at $1269.6, DXY is down -0.13% at 97.144, CAD/USD is down -0.22% at 0.7442.

US Economic Data

Canadian Economic Data

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, David Leclair-Legault

Institutional Bond and Equity Desk
CTI Capital Valeurs Mobilières Inc.

Tel : (514)-861-0240
Fax: (514)-861-3230

Market Update

Tsys opening weaker, US 10Y 2.204 (+1.6bps), narrow trading range on above avg volume (350K TY1) after surprise UK election result. UK election produced hung parliament with conservatives losing their majority  and Brexit uncertainty. EGBs mixed with most of the vol seen in FX, UK gilt yields lower by 2bps, bunds slightly weaker. The GBP is off 1.5% rebounding somewhat, still the largest decline since early October. GOCs lower spds 1bo wider vs tsys after huge beat in Cdn employment 54.5K vs 15k exp- 77K in full time with the unemployment  rate at 6.6% as exp.  Provis opening unch after closing unch yest.

News headlines 

Sterling Slides on U.K. Vote; Dollar, Oil Advance: Markets Wrap (Bloomberg) The pound tumbled as the U.K.’s ruling Conservative Party lost its parliamentary majority, plunging the country into uncertainty just days before Brexit negotiations were due to start. Crude advanced and the dollar strengthened.

China’s easing factory gate prices hint at broader economic slowdown (Reuters) China’s producer price inflation eased for the third straight month in May on tumbling prices of raw materials, signaling a broader cooling in economic activity as profits are squeezed by slackening domestic demand and rising financing costs.

May Digs In as U.K. Premier After Election Debacle (Bloomberg) Theresa May launched a desperate fightback to hold on to her premiership following a disastrous election that cost her party its parliamentary majority and with it the right to rule the U.K. on its own.

In China, some firms ask workers to buy shares in a bid to raise stock price (Reuters) Around two dozen mainly small listed Chinese companies have taken the unusual step of urging their employees to buy shares in a bid to prop up stock prices and help fend off collateral calls on stock-backed loans.

Hudson’s Bay Co is eliminating 2,000 positions to offset retail sector challenges (Financial Post) Hudson’s Bay Co. announced Thursday a major overhaul of its operational structure, laying off 2,000 employees as part of a plan to save $350 million per year by the end of fiscal 2018.

Enbridge Inc. expands oil and gas pipeline capacity as production surges (Financial Post) Enbridge Inc. plans to expand its main oil pipeline system and its newly acquired natural gas pipeline system in B.C. as production of both commodities continue to rise in Western Canada.

Overnight markets 

Overview: US 10yr note futures are down -0.136% at 126-09, S&P 500 futures are up 0.11% at 2433, Crude oil futures are down -0.07% at $45.61, Gold futures are down -0.56% at $1272.3, DXY is up 0.53% at 97.428, CAD/USD is down -0.39% at 0.7432.

US Economic Data

Canadian Economic Data

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, David Leclair-Legault

Institutional Bond and Equity Desk
CTI Capital Valeurs Mobilières Inc.

Tel : (514)-861-0240
Fax: (514)-861-3230