Commentaires matinaux

News headlines

U.S. Stock Futures Advance Amid Bets on Easing: Markets Wrap (Bloomberg) U.S. stock-index futures climbed with equities in Asia as traders weighed a series of fresh stimulus moves expected from the world’s central banks. Shares fluctuated in Europe, where bonds slipped alongside Treasuries.

TSX futures tick up on rising crude prices (Reuters) Futures for Canada’s main stock index edged up on Monday, following a rise in oil prices after Saudi Arabia’s new energy minister confirmed his country’s commitment to OPEC-led crude supply cuts.

China’s exports unexpectedly shrink as U.S. tariffs bite (BNN) China’s exports unexpectedly contracted in August, with sales to the U.S. tumbling amid the escalating trade war between the two nations.

Oil Rises as New Saudi Minister Signals OPEC+ Cuts to Continue (Bloomberg) Oil rose for a fourth day after Saudi Arabia’s new energy minister signaled that OPEC and its allies will continue with production cuts as the group prepared to gather in Abu Dhabi.

Japan downgrades second-quarter GDP as trade war hits business investment (Reuters) Japan’s economy grew at a slower pace than initially estimated in the second quarter as the U.S.-China trade war prompted a downward revision of business spending, intensifying calls for the central bank to deepen stimulus this month.

Time for shock and awe: Five questions for the ECB (Reuters) This week’s European Central Bank meeting is shaping up as one of the most anticipated in years as the central bank gears up to boost a frail economy with a series of stimulus measures.

As China trade war escalates, 2020 U.S. Democrats scramble over their message (Reuters) The growing economic fallout from President Donald Trump’s drawn-out trade war with China would appear to be a ready-made opportunity for Democratic presidential contenders seeking to blunt his central 2020 re-election pitch: That he has made the economy great again.

UK economy shows unexpected strength in July, dampening recession fears (Reuters) Britain’s economy picked up more than expected in July, data showed on Monday, dampening fears that it will succumb to its first recession since the financial crisis as the Brexit crisis escalates.

Market Overview: US 10yr note futures are down -0.238% at 131-02, S&P 500 futures are up 0.32% at 2990.25, Crude oil futures are up 0.64% at $56.88, Gold futures are up 0.3% at $1520, DXY is down -0.08% at 98.319, CAD/USD is down -0.09% at 0.7602.

Cda Benchmarks	Yield	Tsy Benchmarks	Yield
2 Year	1.517%	2 Year	1.561%
5 Year	1.351%	5 Year	1.456%
10 Year	1.306%	10 Year	1.589%
30 Year	1.524%	30 Year	2.065%

US Economic Data

03:00 PM

Consumer Credit, Jul  Survey: $16.000b  Prior: $14.596b

Canadian Economic Data

10:00 AM

Bloomberg Nanos Confidence, Sep 6  Survey: —  Prior: 56.4

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

US tsys lower, yields 3-4bps higher, 10Y 1.505 (+4bps), positive sentiment on news trade talks will resume between the US & China in October. Huge beat on ADP – 195k vs 148k exp. Rally in GBP & pullback in gilts, 10Y gilt +8bps 0.57% highest since August 1st.  Boris Johnson’s proposal to hold a snap election on October 15th was rejected by MPs, while his brother Bo resigned from cabinet.  US stock futures higher (S&P +24), crude unch 56.30 despite API data showing a surprise 401k bbl build in crude inventories for last week, DOE inventories at 10:30. GOCs lower continuing underperformance vs the US, 10Y +6bps 1.20%. BOC yesterday less dovish than expected, saying monetary policy was ‘appropriate’.

News headlines

Stock futures higher on news of U.S.-China trade talks (Reuters) U.S. stock index futures rose on Thursday as the United States and China agreed to hold high-level talks next month, raising hopes of a de-escalation in a trade war that has bruised global economic growth.

TSX futures rise on news of U.S.-China trade talks (Reuters) Canada’s main stock index futures edged up on Thursday, tracking global markets, after China and the United States agreed to hold high-level trade talks in early October in Washington.

China, U.S. to hold trade talks in October as mistrust remains (BNN) China and the U.S. announced that face-to-face negotiations aimed at ending their tariff war will be held in Washington in the coming weeks, amid skepticism on both sides that any substantive progress can be made.

U.S. Fed to further simplify ‘stress capital buffer’ plan: Quarles (Reuters) Randal Quarles, head of supervision at the Federal Reserve, said on Thursday the U.S. central bank is preparing to further simplify a pending bank capital rule known as the “stress capital buffer,” following industry concerns.

Recession risks rise for Germany as industrial orders plunge (Reuters) German industrial orders fell more than expected in July on weak demand from abroad, data showed on Thursday, suggesting that struggling manufacturers could tip Europe’s biggest economy into a recession in the third quarter.

Apple places $7 billion in return to bond market (Reuters) Apple Inc (AAPL.O) said on Thursday it had sold $7 billion of bonds at yields ranging up to 103 basis points over the equivalent U.S. Treasury on maturities of up to 30 years, its first such debt issues since November 2017.

Canada appoints former McKinsey consultant envoy to China, business groups pleased (Reuters) Canada has appointed veteran business consultant Dominic Barton as ambassador to China, Prime Minister Justin Trudeau said on Wednesday, as the government grapples with a major diplomatic and trade dispute between the nations.

U.S., Japan rush to finish trade deal by Trump’s tight deadline (BNN) The U.S. and Japan are still thrashing out details of a trade deal that President Donald Trump wants to sign this month, including the crucial issue of whether he’ll refrain from imposing higher tariffs on imported cars, according to people familiar with the matter.

Market Overview: US 10yr note futures are down -0.331% at 131-27, S&P 500 futures are up 0.87% at 2964, Crude oil futures are up 0.18% at $56.36, Gold futures are down -0.49% at $1552.8, DXY is down -0.31% at 98.149, CAD/USD is down -0.16% at 0.7574.

Cda Benchmarks	Yield	Tsy Benchmarks	Yield
2 Year	1.376%	2 Year	1.468%
5 Year	1.201%	5 Year	1.361%
10 Year	1.194%	10 Year	1.51%
30 Year	1.467%	30 Year	2.01%

US Economic Data

07:30 AM	Challenger Job Cuts YoY, Aug  Survey: —  Actual: 39.00% Prior: 43.20%
08:15 AM	ADP Employment Change, Aug  Survey: 148k Actual: 195k  Prior: 156k Revised: 142k
08:30 AM	Nonfarm Productivity, 2Q F  Survey: 2.20%  Prior: 2.30%
	Unit Labor Costs, 2Q F  Survey: 2.40%  Prior: 2.40%
	Initial Jobless Claims, Aug 31  Survey: 215k  Prior: 215k
	Continuing Claims, Aug 24 Survey: 1688k  Prior: 1698k
09:45 AM	Bloomberg Consumer Comfort, Sep 1  Survey: —  Prior: 62.5
	Markit US Services PMI, Aug F  Survey: 50.9  Prior: 50.9
	Markit US Composite PMI, Aug F  Survey: —  Prior: 50.9
10:00 AM	Factory Orders, Jul  Survey: 1.00%  Prior: 0.60%
	Factory Orders Ex Trans, Jul  Survey: —  Prior: 0.10%
	Durable Goods Orders, Jul F  Survey: 2.10%  Prior: 2.10%
	Durables Ex Transportation, Jul F  Survey: -0.40%  Prior: -0.40%
	Cap Goods Orders Nondef Ex Air, Jul F  Survey: —  Prior: 0.40%
	Cap Goods Ship Nondef Ex Air, Jul F  Survey: —  Prior: -0.70%
	ISM Non-Manufacturing Index, Aug  Survey: 54.0  Prior: 53.7

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

The BOC expected to leave rates unchanged at 1.75% and issue a cautious outlook given uncertainties over trade. Since the July MPR , the Canadian economy has remained relatively robust , with Q2 GDP coming in at 3.7% vs 2.3% forecast in MPR. Meanwhile inflation has hovered close to target and core prices have moved higher. Still a key forward looking indicator,  the Markit PMI, fell to 49.1 in August, pointing to weakness in manufacturing. The outsized contribution from exports (+5.5% in Q2) is unlikely to be sustained , indeed international trade reverted back to deficit in July according to this morning’s STCA figures. Short end pricing might seem aggressive, with the 2Y/3Y roll at -3.3bps , yet we prefer to wait post BOC to fade the inversion at the short end.

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