Commentaires matinaux

Market Update

US tsys higher on above avg volume (380k TY), 10Y 1.58% (-2bps), one month low.  US equity futures under pressure since Europe, erasing gains with S&P +2 vs +12 earlier.  Core Euro bonds also higher, gilt yields 2-3bps lower after a weak Sep Services PMI (below 50) and news the EU views Boris Johnson’s newest proposals as ‘problematic’ . In the US a number of Fed speakers due as well as ISM non-manufacturing, Factory Orders & Durable Goods. In Canada, GOCs higher in line with tsys the CAD slightly weaker after falling the most in six months yesterday on surprise build in crude inventories, the most since May.

News headlines

U.S. Futures Erase Advance as Services Data Looms: Markets Wrap (Bloomberg) U.S. equity futures erased a gain on Thursday and European stocks edged lower as investors looked ahead to key data on the health of the world’s biggest economy. Shares fell across most of Asia, while government bonds advanced.

TSX futures slip as global growth concerns weigh on oil (Reuters) Futures for Canada’s main stock index edged lower on Thursday as oil prices slipped, pressured by concerns about global economic growth.

Oil Near Two-Month Low on Swelling U.S. Stockpiles, Demand Woes (Bloomberg) Oil held near the lowest level in almost two months as American crude inventories expanded the most since May and disappointing U.S. economic data added to pessimism over the demand outlook.

U.S. to slap tariffs on European planes, whiskey after WTO ruling (BNN) The price of Scotch, French wine, cheese and other European exports is about to go up in the U.S. after the Trump administration announced new tariffs on billions of dollars of EU products starting Oct. 18.

Yes whey! U.S. touts dairy product to Chinese hog farmers fighting swine fever (Reuters) When Beijing announced it was exempting 16 U.S. goods from retaliatory tariffs, Chinese firms hurried to call Proliant Dairy Ingredients in the heart of American farm country.

Fed still has ‘reasonable amount of independence’: Evans (Reuters) The U.S. Federal Reserve continues to enjoy “a reasonable amount of independence” and is focused on its mandate despite criticism of its policy moves by U.S. President Donald Trump, Chicago Federal Reserve Bank President Charles Evans said on Thursday.

India protectionist, but U.S. negotiating limited trade deal: Ross (Reuters) India is among the world’s most protectionist countries but the United States is trying to negotiate a limited trade deal with the South Asian nation to resolve their differences, U.S. Secretary of Commerce Wilbur Ross said on Thursday.

U.S. skies still bright for Main Street banks even as Wall Street frets (Reuters) The view from Wall Street may be all trade wars, tariffs and uncertainty these days, but ask a Main Street banker and things are pretty darn good.

Market Overview: US 10yr note futures are up 0.083% at 131-08, S&P 500 futures are up 0.06% at 2882.25, Crude oil futures are down -0.3% at $52.48, Gold futures are up 0.03% at $1508.3, DXY is down -0.01% at 99.012, CAD/USD is up 0.05% at 0.7499.

Cda Benchmarks	Yield	Tsy Benchmarks	Yield
2 Year	1.472%	2 Year	1.468%
5 Year	1.305%	5 Year	1.417%
10 Year	1.284%	10 Year	1.579%
30 Year	1.468%	30 Year	2.064%

US Economic Data

07:30 AM	Challenger Job Cuts YoY, Sep  Survey: —  Actual: -24.80% Prior: 39.00%
08:30 AM	Initial Jobless Claims, Sep 28  Survey: 215k  Prior: 213k
	Continuing Claims, Sep 21 Survey: 1654k  Prior: 1650k
09:45 AM	Bloomberg Consumer Comfort, Sep 29  Survey: —  Prior: 61.7
	Markit US Services PMI, Sep F Survey: 50.9 Prior: 50.9
	Markit US Composite PMI, Sep F  Survey: —  Prior: 51.0
10:00 AM	ISM Non-Manufacturing Index, Sep  Survey: 55.0  Prior: 56.4
	Factory Orders, Aug  Survey: -0.20%  Prior: 1.40%
	Durable Goods Orders, Aug F  Survey: —  Prior: 0.20%
	Durables Ex Transportation, Aug F  Survey: —  Prior: 0.50%
	Cap Goods Orders Nondef Ex Air, Aug F  Survey: —  Prior: -0.20%
	Cap Goods Ship Nondef Ex Air, Aug F  Survey: —  Prior: 0.40%

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 trading higher maintaining gains from overnight ‘risk off’ session, yields 1-4bps lower led by the short end , 10Y 1.63% and the tsy curve 3 bps steeper.  Prices off the highs after Sep ADP 135k vs 140k exp with Aug revised lower 157k vs 195k. S&P futures -13pts, just off the lows, crude slightly higher after 11 straight days of declines.  FTSE -2% worst decline in two months after Boris Johnson threatened a no-deal Brexit unless a deal is done on his terms.  GOCs  mixed,curve steeper & wider vs tsys, 10Y 1.36%. BOC auctions $3.3bln of reopened 1.25% June 2030s with the J30/10Y roll 2.2/2.0

News headlines

U.S. Futures Fall With Europe Stocks; Dollar Rises: Markets Wrap (Bloomberg) U.S. stock-index futures retreated with Asian shares while equities sank across Europe as miserable manufacturing data from the world’s largest economy kept reverberating around markets. The dollar advanced.

TSX futures slip on global growth fears (Reuters) Futures for Canada’s main equity index fell on Wednesday after a weak U.S. manufacturing report added to global growth worries.

Oil Steady After Six-Day Slide Amid Tighter Supply, Demand Fears (Bloomberg) Oil steadied after sliding for six days in a row as signs of tighter supply in the U.S. and OPEC jostled with ongoing concern that a fragile global economy is eroding fuel demand.

German Growth Outlook Dims on Waning Export Demand, Trade Spats (Bloomberg) Germany’s five leading research institutes slashed their forecasts for economic growth, as manufacturers in Europe’s biggest economy struggle with waning global demand and lingering trade disputes.

WTO to back U.S. tariffs over Airbus subsidies (Reuters) The World Trade Organization is poised on Wednesday to open the door to hefty U.S. tariffs on European goods over illegal subsidies for Airbus, pushing a 15-year-old row over support for plane giants to the center of fraught global trade relations.

Italy says very worried by prospect of U.S. tariffs on its exports (Reuters) Foreign Minister Luigi Di Maio said on Wednesday that Rome was worried by the prospect of U.S. tariffs on Italian exports.

U.S. Fed charts its own course on climate change, too (Reuters) Dallas Federal Reserve President Robert Kaplan faced more questions on one particular topic than any other at a recent lunch with local business owners and community leaders on Texas’s Gulf Coast.

Hong Kong August retail sales worst on record as protests escalate (Reuters) Hong Kong’s August retail sales were the worst on record, the government said on Wednesday, as escalating anti-government protests that have gripped the Chinese-ruled city for nearly four months scared off tourists and battered spending.

Market Overview: US 10yr note futures are up 0.108% at 130-26, S&P 500 futures are down -0.43% at 2925.25, Crude oil futures are up 0.82% at $54.06, Gold futures are up 0.22% at $1492.3, DXY is up 0.08% at 99.205, CAD/USD is up 0.17% at 0.7549.

Cda Benchmarks	Yield	Tsy Benchmarks	Yield
2 Year	1.512%	2 Year	1.516%
5 Year	1.365%	5 Year	1.472%
10 Year	1.352%	10 Year	1.625%
30 Year	1.515%	30 Year	2.089%

US Economic Data

07:00 AM	MBA Mortgage Applications, Sep 27  Survey: —  Actual: 8.10% Prior: -10.10%
08:15 AM	ADP Employment Change, Sep  Survey: 140k Actual: 135k Prior: 195k Revised 157k

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 trading broadly lower on heavy volume (480k TY), yields 3-6bps higher, 10Y 1.73% (+6bps), yield curve bear steepening. me in TY futures (~330k).  Weakest Japanese 10Y auction in three years pressuring global bonds, JGB futures largest one-day decline since July 2016. Chicago Fed Evans reiterated he is not in favor of a third rate cut , while mon policy is ‘appropriate’.  GOCs lower, steeper out to 10s, with 10s30s flattening for a second day, ~3bps since Friday consistent with m/e buying in longs which showed up mid aft yesterday.  July GDP on deck (0.1% exp after 0.2% June)

News headlines

Bonds Sink on Weak Japan Sale; U.S. Futures Rise: Markets Wrap (Bloomberg) Treasuries joined a retreat across sovereign bonds on Tuesday after a weak debt auction in Japan triggered a sell-off that gradually spread across the world. U.S. equity futures advanced with shares in Asia, while European stocks slipped amid disappointing factory and inflation data.

TSX futures gain as oil prices recover (Reuters) Stock futures pointed to a higher opening for Canada’s main stock index on Tuesday, as oil prices rebounded on reports of lower output from the world’s largest oil producers.

Oil Rebounds After Worst Quarter of 2019, Yet Demand Fears Weigh (Bloomberg) Oil rose after its biggest quarterly slump of the year, yet ongoing concerns that a faltering global economy will erode demand continued to weigh on the market.

WTO sees sharp drop in global trade growth amid tariff wars (BNN) The World Trade Organization cut its global trade growth forecast for this year to the weakest level in a decade, warning that further rounds of tariffs in an environment of heightened uncertainty could spark a “destructive cycle of recrimination.”

Fed can keep rates on hold for now, raise them later: Evans (Reuters) The Federal Reserve has set monetary policy to where it can deliver on its 2% inflation goal and there is scope to raise rates slightly over the next few years if the economy continues to grow, Chicago Fed President Charles Evans said on Tuesday.

Major U.S. investors have billions at risk in Chinese stocks (Reuters) Major U.S. fund managers have tens of billions of dollars at stake in some of the most popular Chinese stocks on Wall Street, exposing them to potential losses should the White House move to delist Chinese firms from U.S. exchanges.

Brexit vote reprise? Money flows out of UK property funds (Reuters) Britain’s top property investment funds have shed almost 10% of their combined assets this year as investors fret about the impact of Britain’s exit from the European Union.

Market Overview: US 10yr note futures are down -0.348% at 129-28, S&P 500 futures are up 0.18% at 2983.75, Crude oil futures are up 0.67% at $54.43, Gold futures are up 0.05% at $1473.7, DXY is up 0.13% at 99.503, CAD/USD is up 0.27% at 0.7533.

Cda Benchmarks	Yield	Tsy Benchmarks	Yield
2 Year	1.604%	2 Year	1.656%
5 Year	1.438%	5 Year	1.596%
10 Year	1.416%	10 Year	1.727%
30 Year	1.576%	30 Year	2.175%

US Economic Data

09:45 AM	Markit US Manufacturing PMI, Sep F  Survey: 51.0  Prior: 51.0
10:00 AM	ISM Manufacturing, Sep  Survey: 50.0  Prior: 49.1
	ISM Employment, Sep  Survey: —  Prior: 47.4
	ISM Prices Paid, Sep  Survey: 50.5  Prior: 46.0
	ISM New Orders, Sep  Survey: —  Prior: 47.2
	Construction Spending MoM, Aug  Survey: 0.50%  Prior: 0.10%

Canadian Economic Data

08:30 AM	GDP MoM, Jul  Survey: 0.10%  Prior: 0.20%
	GDP YoY, Jul  Survey: 1.40%  Prior: 1.50%
09:30 AM	Markit Canada Manufacturing PMI, Sep  Survey: —  Prior: 49.1

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