Commentaires

Market Update

Tsys trading higher, 10Y 1.71% (-2.5bps), prices pulling back since uptick in Asia trade which saw 10Y trade below 1.70%. No reaction to as expected Q2 GDP, core prices higher (1.9% vs 1.7%). Equity futures higher, S&P +6, crude lower for 3rd day 56.40. Fed 14-day term repo operation saw $72.8bln in bunds for $60bln offering. Core Euro bonds mixed on now news, bunds lower as equity futures move higher. GOCs higher in line with tsys, 10s30s 2bps wider, even as 2s10s has moved back to recent narrows -20bps. BOC switch operation buying back off the run longs for Dec 51s for $400mln max.

News headlines

U.S. Futures, Europe Stocks Climb With Treasuries: Markets Wrap (Bloomberg) U.S. equity futures edged higher with Asian stocks on Thursday while European shares jumped as investors awaited the next developments in a week dominated by political dramas and a lack of clarity over trade. In a sign of the mixed sentiment, Treasuries also climbed, continuing a choppy few days.

Futures rise on U.S.-China trade optimism (Reuters) Futures for Canada’s main index were higher on Thursday, as sentiment was lifted by positive comments from China on the trade talks with the United States.

China says in close communication with U.S. over October trade talks (Reuters) China and the United States are still discussing details about upcoming trade talks in October, making preparations to ensure “positive progress” is made during the negotiations, the Chinese commerce ministry said on Thursday.

U.S. Fed should target repo rate to reduce market volatility: ex-Fed officials (Reuters) Recent money market volatility shows the Federal Reserve needs to retool how it manages an essential part of the financial system to minimize disruptive market swings that pose risks to the economy, two former Fed officials said on Thursday.

BOJ’s Kuroda warns of overseas risks, signals readiness to adjust policy (Reuters) Japan’s central bank governor signaled on Thursday readiness to ease monetary policy further, vowing to guide policy appropriately “without any preset conditions in mind”.

Oil Steady as Investors Weigh Trade Hope Against Saudi Recovery (Bloomberg) Oil was steady as investors weighed prospects of a thaw in the U.S.-China trade war against indications Saudi Arabia is recovering quicker than expected from the biggest attacks ever on its energy industry.

Its leash lengthened, China’s yuan flirts with trade war role (Reuters) China, having let the yuan cross the once sacred red line of 7 per dollar, will allow its currency to fall further and may even risk U.S. anger by using it as a bargaining chip in already thorny trade talks, market participants believe.

In Michigan steel towns, tariffs meant to revive industry cost jobs (Reuters) Some steelworkers who cheered U.S. President Donald Trump’s tariffs on foreign steel last year are now being laid off, an unintended consequence of his America First policy as United States Steel Corp (X.N) reacts to sagging demand from automakers reeling from higher steel prices.

Market Overview: US 10yr note futures are up 0.06% at 130-01, S&P 500 futures are up 0.21% at 2992.5, Crude oil futures are up 0.09% at $56.54, Gold futures are down -0.04% at $1511.7, DXY is up 0.03% at 99.064, CAD/USD is down -0.2% at 0.7551.

Cda Benchmarks	Yield	Tsy Benchmarks	Yield
2 Year	1.584%	2 Year	1.676%
5 Year	1.423%	5 Year	1.6%
10 Year	1.389%	10 Year	1.715%
30 Year	1.558%	30 Year	2.163%

US Economic Data

08:30 AM	GDP Annualized QoQ, 2Q T  Survey: 2.00% Actual: 2.00% Prior: 2.00%
	Personal Consumption, 2Q T  Survey: 4.70% Actual: 4.60% Prior: 4.70%
	GDP Price Index, 2Q T  Survey: 2.40% Actual: 2.40% Prior: 2.40%
	Core PCE QoQ, 2Q T  Survey: 1.70% Actual: 1.90% Prior: 1.70%
	Wholesale Inventories MoM, Aug P  Survey: 0.10% Actual: 0.40% Prior: 0.20%
	Initial Jobless Claims, Sep 21  Survey: 212k Actual: 213k Prior: 208k
	Continuing Claims, Sep 14  Survey: 1666k Actual: 1650k Prior: 1661k
09:45 AM	Bloomberg Consumer Comfort, Sep 22  Survey: —  Prior: 62.7
10:00 AM	Pending Home Sales MoM, Aug  Survey: 1.00%  Prior: -2.50%
11:00 AM	Kansas City Fed Manf. Activity, Sep  Survey: -4  Prior: -6

Canadian Economic Data

06:00 AM

CFIB Business Barometer, Sep  Survey: — Actual: 59.3 Prior: 60.6

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 lower, declining as equity futures pare losses, 10Y 1.65%, focus on House Democrat’s impeachment inquiry with transcript of call between trump and Ukrainian Pres expected to be released today. S&P futures have rallied back close to unch after being down 0.50%, DXY erasing yesterday’s losses. No eco data thou multiple Fed speakers and $18bln 2Y FRN & $41bln 5Y note auctions. UK gilts outperforming in core Europe, fallout from yest Supreme Court ruling hitting the BP. GOCs higher, 1bp narrower vs tsys in 10s,  3Y auction at noon (reopening Sep 22s for $2.4bln).

News headlines

U.S. Futures Slip, Europe Stocks Slump; Oil Falls: Markets Wrap (Bloomberg) U.S. equity-index futures dipped while stocks slumped in Europe and Asia as investors weighed the deepening political gridlock in Washington against prospects for reduced trade tension between America and China. The dollar advanced and oil fell.

TSX futures slip on lower oil prices (Reuters) Futures for Canada’s main index fell on Wednesday, as oil prices slipped over demand concerns.

Oil Declines as Saudi Arabia Restores Capacity Ahead of Schedule (Bloomberg) Oil extended declines as Saudi Arabia was said to be ahead of schedule in restoring its output capacity.

Explainer: Trade deal in focus as Trump, Japan’s Abe head for summit (Reuters) U.S. President Donald Trump and Japanese Prime Minister Shinzo Abe meet in New York later on Wednesday to try to clinch a deal on farm tariffs and digital trade.

Trump impeachment? History suggests Wall Street ought not worry (Reuters) The move by Democrats in the U.S. Congress on Tuesday to launch a formal impeachment inquiry into President Donald Trump has caused nervousness on Wall Street – but history suggests investors need not worry.

Sanctions-hit Iran props up economy with bartering, secret deals (Reuters) Washington’s policy of applying “maximum pressure” on Iran with wide-ranging sanctions has shredded the country’s oil revenues, sent its economy into recession and devalued its national currency.

China says has no intent to play ‘Game of Thrones’ but warns on sovereignty (Reuters) China’s top diplomat hit back at U.S. criticism of its trade and development model on Tuesday, saying Beijing had no intention to “play the Game of Thrones on the world stage” but warned Washington to respect its sovereignty, including in Hong Kong.

Market Overview: US 10yr note futures are down -0.096% at 130-19, S&P 500 futures are down -0.07% at 2968.25, Crude oil futures are down -1.87% at $56.22, Gold futures are down -0.4% at $1534, DXY is up 0.43% at 98.763, CAD/USD is up 0.27% at 0.7532.

Cda Benchmarks	Yield	Tsy Benchmarks	Yield
2 Year	1.516%	2 Year	1.614%
5 Year	1.333%	5 Year	1.529%
10 Year	1.299%	10 Year	1.647%
30 Year	1.472%	30 Year	2.096%

US Economic Data

07:00 AM	MBA Mortgage Applications, Sep 20  Survey: —  Actual: -10.1% Prior: -0.1%
10:00 AM	New Home Sales, Aug  Survey: 659k  Prior: 635k
	New Home Sales MoM, Aug  Survey: 3.8%  Prior: -12.8%

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 higher on avg volume (320k TY futures), US 10Y 1.70% (-2bps), flattening in UST curve with 3m10Y -20bps close to middle of -50 to +5 range over past month.  NY Fed repo operation bought $30bln in 14 day repo and was 2x oversubscribed. UK gilts rallied after Supreme Court ruled PM Boris Johnson’s suspension of parliament was unlawful, 10Y gilt future at weekly high. GOCs  higher, in line with tsys, 10s30s 1bp steeper last two days after sharp narrowing since late Aug. On Thursday the BOC will conduct a switch operation, buying back off the run 33s,37s & 41s in exchange for Dec 51s with a maximum of $400mln. Eco data calendar picks up only next week with July GDP.

News headlines

Stocks Climb on Trade Optimism; Treasuries Edge Up: Markets Wrap (Bloomberg) U.S. equity-index futures advanced with European stocks while Asian shares rose modestly as investors weighed hopes for high-level trade talks next month between America and China against mixed economic data from around the globe. The pound rose after a court ruling key to Brexit.

TSX futures advance on U.S.-China trade hopes (Reuters) Futures for Canada’s main stock index rose on Tuesday on trade optimism after Washington said the United States and China would resume trade talk in two weeks.

Oil Slips on Signs of Returning Saudi Output as Doubts Linger (Bloomberg) Oil edged lower on signs Saudi Arabia is making progress in restoring lost output even as uncertainty remains about the kingdom’s ability to meet its timeline of a full return by the end of the month.

China grants new tariff waivers for U.S. soybean imports: Bloomberg (Reuters) China has granted new waivers to several domestic state and private firms exempting them from retaliatory tariffs on soybeans imported from the United States, Bloomberg said, citing unidentified sources familiar with the matter.

Pound rallies, stocks slip on UK Supreme Court ruling (Reuters) Sterling extended gains on Tuesday while eurozone stocks tumbled after Britain’s Supreme Court ruled that British Prime Minister Boris Johnson had acted unlawfully when he advised Queen Elizabeth to suspend Parliament this month.

BOJ’s Kuroda says any easing will target short-, medium-term rates (Reuters) Bank of Japan Governor Haruhiko Kuroda said on Tuesday that if the central bank were to ease monetary policy further, it would aim at pushing down short- and medium-term interest rates without flattening the yield curve too much.

Argentina’s markets, caged by controls, strain beneath the surface (Reuters) Argentina’s volatile markets look to have been tamed by capital controls imposed by President Mauricio Macri after a sharp sell-off in August. Beneath the surface, however, signs suggest trouble is brewing.

Market Overview: US 10yr note futures are up 0.036% at 130-04, S&P 500 futures are up 0.31% at 3006.25, Crude oil futures are down -0.95% at $58.08, Gold futures are down -0.17% at $1528.9, DXY is down -0.02% at 98.576, CAD/USD is down -0.04% at 0.7544.

Cda Benchmarks	Yield	Tsy Benchmarks	Yield
2 Year	1.555%	2 Year	1.675%
5 Year	1.392%	5 Year	1.579%
10 Year	1.351%	10 Year	1.701%
30 Year	1.51%	30 Year	2.145%

US Economic Data

09:00 AM	FHFA House Price Index MoM, Jul  Survey: 0.30%  Prior: 0.20%
	S&P CoreLogic CS 20-City MoM SA, Jul  Survey: 0.10%  Prior: 0.04%
	S&P CoreLogic CS 20-City YoY NSA, Jul  Survey: 2.10%  Prior: 2.13%
	S&P CoreLogic CS 20-City NSA Index, Jul  Survey: —  Prior: 217.65
10:00 AM	Richmond Fed Manufact. Index, Sep  Survey: 1  Prior: 1
	Conf. Board Consumer Confidence, Sep  Survey: 133.0  Prior: 135.1

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