Commentaires

Market Update

Tsys trading lower, the 10Y back above 1.80%, (1.82 +4bps) heavy volume in TY futures (512k) , risk on with S&P futures (+6.5) looking to extend record highs on reports Trump will drop existing tariffs on $112bln in Chinese imports, the Chinese currency rising to the highest since August. Crude higher for a 3^rd day (57.05 +1%) on trade optimism while OPEC said the outlook for the oil market has brightened going into next year – API inventory data later today. GOCs lower and steeper, 2s10s widest since August 1^st, ~8bps since the BOC decision. We like maintaining steepeners given the cautious BOC and US tsy supply set to pick up this week (3s,10s & 30s).

News headlines

U.S. Futures Gain With Stocks; Treasuries Retreat: Markets Wrap (Bloomberg) U.S. equity futures climbed with European and Asian stocks as investors took confidence from signs that America and China are inching toward a trade deal. Treasuries fell, while the yuan strengthened past 7 for the first time since August.

TSX futures up as trade optimism lifts oil (Reuters) Canada’s main stock index futures rose slightly on Tuesday, as crude prices gained on hopes of a trade deal between the United States and China.

Oil Gains for a Third Day as Trade Deal Optimism Extends (Bloomberg) Oil rose for a third day, buoyed by signs of progress in the prolonged U.S.-China trade dispute, despite expectations for expanding American crude stockpiles.

Fed’s Barkin: Conflicting signals make U.S. economy hard to read (Reuters) Conflicting signals make it difficult to get a handle on the true health of the U.S. economy and reducing uncertainty for businesses would provide a shot in the arm to growth, Richmond Fed Reserve Bank President Thomas Barkin said on Tuesday.

Scramble for propane marks Mother Nature’s latest challenge for U.S. farmers (Reuters) Months after historic floods ravaged the U.S. Midwest, farmers scrambling to harvest their crops face a new headache: finding fuel to dry their soaked grains.

China presses Trump for more tariff roll-backs in ‘phase one’ trade deal (Reuters) China is pushing U.S. President Donald Trump to remove more tariffs imposed in September as part of a “phase one” U.S.-China trade deal, people familiar with the negotiations said on Monday.

OPEC sees its oil market share shrinking, lowers demand view (Reuters) OPEC will supply a diminishing amount of oil in the next five years as output of U.S. shale and other rival sources expands, the exporter group said, despite a growing appetite for energy fed by global economic expansion.

Market Overview: US 10yr note futures are down -0.181% at 129-11, S&P 500 futures are up 0.2% at 3081.75, Crude oil futures are up 0.96% at $57.08, Gold futures are down -0.59% at $1502.2, DXY is up 0.15% at 97.651, CAD/USD is down -0.16% at 0.7616.

Cda Benchmarks	Yield	Tsy Benchmarks	Yield
2 Year	1.622%	2 Year	1.61%
5 Year	1.576%	5 Year	1.625%
10 Year	1.572%	10 Year	1.818%
30 Year	1.732%	30 Year	2.307%

US Economic Data

08:30 AM	Trade Balance, Sep  Survey: -$52.4b Actual:-$52.5b Prior: -$54.9b
09:45 AM	Markit US Services PMI, Oct F  Survey: 51.0  Prior: 51.0
	Markit US Composite PMI, Oct F  Survey: —  Prior: 51.2
10:00 AM	ISM Non-Manufacturing Index, Oct  Survey: 53.5  Prior: 52.6

Canadian Economic Data

08:30 AM

Int’l Merchandise Trade, Sep  Survey: -0.65b Actual: -0.98b  Prior: -0.96b

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

Tsys lower on below avg volume (<300k TY), 10Y  1.745% (+3.5bps),  with equity futures higher (S&P +14), crude extending Friday’s rally, up another 1.0% to 56.75, European stocks +1%. Continued progress on US-China trade , China FM saying pres Xi has been in constant communication with Trump’s team, adding to comments by Ross on ‘Phase one’ of a trade deal being close.  Core euro bonds lower, lagging the pullback in tsys, 10Y tsy/bund spd 3bps wider 211bps, just off the lowest levels since June 2018.  GOCs lower in line with tsys, 2s30s 2bps steeper, +5bps since BOC cautious statement on trade last week.

News headlines

Stocks Climb on Trade Optimism; Treasuries Slip: Markets Wrap (Bloomberg) U.S. equity futures advanced along with stocks worldwide while bonds slipped on optimism China and America are moving closer to an interim trade deal.

CANADA STOCKS-Trade deal hopes boost TSX futures (Reuters) Futures for Canada’s main stock index rose on Monday, as hopes that the U.S. and China might sign a trade deal later this month lifted oil prices.

China says Xi, Trump in continuous touch (Reuters) Chinese President Xi Jinping and U.S. President Donald Trump have been in continuous touch through “various means”, China’s Foreign Ministry said on Monday, when asked when and where the two leaders might meet to ink a trade deal.

Asia-wide trade pact on course despite India, Thailand says (Reuters) Asian countries held conclusive talks on what could be the world’s biggest trade pact and there will be an announcement of success at a summit in Bangkok, despite doubts raised by India, the Thai hosts said on Monday.

China says no ‘promise fatigue’ on opening its economy (Reuters) There is no “promise fatigue” about China’s efforts to open its economy to foreign businesses, the government said on Monday on the eve of week-long import fair, after the European Union said China needed to make rapid and substantial improvements.

‘Still time’ for Thailand to solve U.S. duty-free issue: U.S. commerce secretary (Reuters) Thailand still has time to renegotiate with the United States over a suspension of duty-free preferences on imports of Thai goods before the suspension takes effect in April, U.S. Commerce Secretary Wilbur Ross said on Monday.

Oil Gains After U.S., Chinese Data Improve Demand Outlook (Reuters) Oil held its biggest gain in almost seven weeks after improved U.S. and Chinese economic data aided the demand outlook and Saudi Aramco said it would go ahead with its long-awaited initial public offering.

Market Overview: US 10yr note futures are down -0.096% at 129-29, S&P 500 futures are up 0.48% at 3078, Crude oil futures are up 1.01% at $56.77, Gold futures are up 0.3% at $1515.9, DXY is up 0.11% at 97.346, CAD/USD is up 0.09% at 0.7602.

Cda Benchmarks	Yield	Tsy Benchmarks	Yield
2 Year	1.579%	2 Year	1.572%
5 Year	1.5%	5 Year	1.567%
10 Year	1.487%	10 Year	1.745%
30 Year	1.651%	30 Year	2.23%

US Economic Data

10:00 AM	Factory Orders, Sep  Survey: -0.50%  Prior: -0.10%
	Durable Goods Orders, Sep F  Survey: -1.10%  Prior: -1.10%
	Durables Ex Transportation, Sep F  Survey: -0.30%  Prior: -0.30%
	Cap Goods Orders Nondef Ex Air, Sep F  Survey: —  Prior: -0.50%
	Cap Goods Ship Nondef Ex Air, Sep F  Survey: —  Prior: -0.70%

Canadian Economic Data

10:00 AM

Bloomberg Nanos Confidence, Nov 1  Survey: —  Prior: 57.4

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

Tsys slightly higher , 10Y 1.68%, TY futures close to highs of o/n range on low volume (300k), equities higher (S&P +4) before Oct Payrolls (85k exp).  GM strike expected to distort data, subtracting overall figure by ~50k and adding 0.1% to unem rate (3.6 vs 3.5).  GOCs slightly lower & flatter, continuing to undo some of the post BOC movement, which saw 5s30s steepen 5bps and Ca/US 8-12bps tighter. Futures mkts are priced for ~50% odds of a rate cut by March, which considering the uncertain global trade outlook is fair even as domestic data has held up well.

News headlines

U.S. Futures, Stocks Rise; Bonds Drift Before Jobs: Markets Wrap (Bloomberg) U.S. index futures climbed with European stocks on Friday as investors weighed better-than-expected Chinese manufacturing data against uncertainty over an interim trade deal. Treasuries were steady ahead of American payrolls figures.

TSX futures tick up on higher oil prices (Reuters) Stock futures pointed to a higher opening for Canada’s main stock index on Friday, supported by gains in oil prices on the back of a surprise bounce in Chinese factory activity.

General Motors strike looms over U.S. October job growth (Reuters) U.S. job growth likely slowed sharply in October, weighed down by a strike at General Motors (GM.N), while the unemployment rate is expected to tick up from near a 50-year low of 3.5%.

Phase one trade deal with China is in good shape: U.S. Commerce chief (Reuters) The initial “phase one” trade pact with China appears to be in good shape and is likely to be signed around mid-November, although a finite date is still in question, U.S. Commerce Secretary Wilbur Ross said on Friday.

Wall Street Week Ahead: Travel, leisure company reports set to give view of economy, consumer (Reuters) A wide swath of the U.S. travel and leisure industry is set to provide insight next week on the state of the economy, including trends in consumer spending, fallout from U.S.-China trade tensions and any damaging impact from the stronger U.S. dollar.

Trump says U.S., China to announce new venue to ink trade deal soon (Reuters) U.S. President Donald Trump said on Thursday the United States and China would soon announce a new site where he and Chinese President Xi Jinping will sign a “Phase One” trade deal after Chile canceled a planned summit set for mid-November.

China’s proposed digital currency more about policing than progress (Reuters) As China prepares to become the first country to launch a digitized domestic currency, market participants and experts say it is a testament to both financial innovation and Beijing’s desire to have fail-safe control over its cash economy.

UK manufacturing decline slows after new Brexit stockpiling rush: PMI (Reuters) A renewed rush to stockpile ahead of another aborted Brexit deadline limited losses for British manufacturers last month, though not by enough to prevent a sixth month of contraction, a survey showed on Friday.

Market Overview: US 10yr note futures are up 0.06% at 130-12, S&P 500 futures are up 0.14% at 3040, Crude oil futures are up 0.79% at $54.61, Gold futures are down -0.13% at $1512.8, DXY is down -0.11% at 97.249, CAD/USD is down 0% at 0.7597.

US Economic Data

08:30 AM	Change in Nonfarm Payrolls, Oct  Survey: 85k  Prior: 136k
	Change in Private Payrolls, Oct  Survey: 80k  Prior: 114k
	Change in Manufact. Payrolls, Oct  Survey: -55k  Prior: -2k
	Unemployment Rate, Oct  Survey: 3.60%  Prior: 3.50%
	Average Hourly Earnings MoM, Oct  Survey: 0.30%  Prior: 0.00%
	Average Hourly Earnings YoY, Oct  Survey: 3.00%  Prior: 2.90%
	Average Weekly Hours All Employees, Oct  Survey: 34.4  Prior: 34.4
	Labor Force Participation Rate, Oct  Survey: 63.10%  Prior: 63.20%
09:45 AM	Markit US Manufacturing PMI, Oct F  Survey: 51.50  Prior: 51.50
10:00 AM	ISM Manufacturing, Oct  Survey: 48.9  Prior: 47.8
	ISM Prices Paid, Oct  Survey: 50.0  Prior: 49.7
	Construction Spending MoM, Sep  Survey: 0.20%  Prior: 0.10%

Canadian Economic Data

09:30 AM

Markit Canada Manufacturing PMI, Oct  Survey: —  Prior: 51.0

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