Commentaires
19/08/2019
Market Update
US tsys off the lows as equities give up some earlier gains (S&P +1%, +4% from Thursday’s low 2818), 10Y 1.60% (+4bps). Tsys steady then under pressure in Europe, steepening with German bunds – bund curve 12bps steeper since Thursday. Euro area CPI rise 1% last month, revised lower from 1.1% adding to the negative data flow from Europe and raising odds of additional ECB stimulus. Focus this week on Jackson Hole conference and Powell speech on Friday. GOCs lagging the move lower in tsys, GOC 10Y 1.18 (+2bps), curve only marginally steeper (1bp) compared to huge move in US & Europe. CPI/Retail Sales key data this week. Odds of a rate cut at the October meeting have risen sharply since the start of the month to ~65% currently.
News headlines
Stocks Climb Globally With Dollar; Treasuries Drop: Markets Wrap (Bloomberg) U.S. equity futures rose alongside stocks in Europe and Asia as traders parsed the latest trade news from Washington and awaited commentary from the Federal Reserve chief. Treasuries fell with European government bonds.
TSX set to open higher as oil prices rise (Reuters) Futures pointed to a higher opening for Canada’s main stock index on Monday as crude prices rose after an attack on a Saudi oil facility by Yemeni separatists during the weekend.
Oil Rises as Drone Attack on Saudi Oilfield Stokes Mideast Fears (Bloomberg) Oil rose for a second day as a drone attack on a Saudi Arabian oil field revived concerns that the tense Middle East political situation may jeopardize crude exports.
Explainer: How China’s new interest rate reforms will work (Reuters) China’s central bank pushed out long-awaited interest rate reforms on Saturday by establishing a reference rate for new loans issued by banks to help steer corporate borrowing costs lower and support a slowing economy.
Stimulus optimism boosts stocks, eases pressure on bonds (Reuters) World stock markets rose on Monday on signs that major economies would look to prop up stalling growth with fresh stimulus measures, easing pressure on bonds and dampening demand for perceived safe-havens such as gold.
BoE’s Carney says negative rates not an option for UK: Central Banking (Reuters) Bank of England Governor Mark Carney said he did not think negative interest rates were an option for the British economy at the moment, in comments published on Monday.
German economy could continue to shrink: Bundesbank (Reuters) The German economy could have continued to shrink over the summer as industrial production drops amid a dearth of orders, the Bundesbank said on Monday, suggesting that the euro zone’s biggest economy is now in a recession.
Trump says U.S. is talking with China but not ready for a deal (BNN) President Donald Trump said the U.S. is “doing very well with China, and talking!” but suggested he wasn’t ready to sign a trade deal, hours after his top economic adviser laid out a potential timeline for the resumption of substantive discussions with Beijing.
Market Overview: US 10yr note futures are down -0.358% at 130-15, S&P 500 futures are up 1.04% at 2921.5, Crude oil futures are up 0.6% at $55.2, Gold futures are down -1.14% at $1506.2, DXY is up 0.08% at 98.218, CAD/USD is down -0.09% at 0.7541.
| Cda Benchmarks | Yield | Tsy Benchmarks | Yield |
| 2 Year | 1.362% | 2 Year | 1.513% |
| 5 Year | 1.231% | 5 Year | 1.459% |
| 10 Year | 1.205% | 10 Year | 1.603% |
| 30 Year | 1.425% | 30 Year | 2.094% |
US Economic Data
There is no US economic data for today.
Canadian Economic Data
| 10:00 AM | Bloomberg Nanos Confidence, Aug 16 Survey: — Prior: 57.8 |
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
16/08/2019
Market Update
US tsys drifting lower since the late afternoon spike yest, which saw the 10Y yield fall to the lowest since August 2016 below 1.50%, currently 1.525% (unch), volume in TY futures closer to avg (383k). EGBs mixed 10Y bund yield new lows @ -0.73%, UK gilt curve bear flattening, 2Y gilt yields +7bps, GBP higher for second day. US money market fund assets have surged to the highest since 2009 according to ICI, with net inflows in 16 out of the last 17 weeks. In Canada, GOCs lower, yields 1-3bps higher with the 10Y 1.11%, after making new low yest 1.08%. Long outperformance main theme over the past week, 10s30s 5bps flatter, similar to move in the US. Sask reopened their 2050 issue @ 91.5 yest, (Ontario +7), spreads unch this morning. AIMCo Realty tapped their 10Y issue @ 115, the tighter end of guidance, issue closed 2bps tighter.
News headlines
U.S. Futures Rise to End Volatile Week; Bonds Dip: Markets Wrap (Bloomberg) U.S. equity futures climbed with European stocks and most Asian shares posted modest gains, as a tumultuous week of trade uncertainty and fears over global growth nears its end. Treasuries pared some of Thursday’s advance.
TSX futures gain on higher oil prices (Reuters) Futures for Canada’s main stock index were up on Friday as crude oil prices rebounded after positive U.S. retail sales data helped ease concerns of a recession in the world’s largest economy.
Oil Heads for Weekly Gain as Trade War Headlines Whipsaw Market (Bloomberg) Oil headed for a weekly increase as hopes that the U.S. and China could resume negotiations to resolve their trade dispute capped a week of volatile trading.
Exclusive: China-owned oil tanker changes name in apparent effort to evade U.S. sanctions (Reuters) While in the Indian Ocean heading toward the Strait of Malacca, the very large crude carrier (VLCC) Pacific Bravo went dark on June 5, shutting off the transponder that signals its position and direction to other ships, ship-tracking data showed.
Powell expected to seek another cut despite strong spending (BNN) The U.S. data pouring in supports Federal Reserve Chairman Jerome Powell’s forecast of solid economic growth and higher inflation. Still, economists remain confident that Powell will cut interest rates again next month as insurance against a global slowdown.
Trump says China talks ‘productive’; Beijing vows tariff retaliation (Reuters) U.S. President Donald Trump said on Thursday that U.S. and Chinese negotiators were holding “productive” trade talks and expected them to meet in September despite U.S. tariffs on over $125 billion worth of Chinese imports taking effect Sept 1.
Brazil’s foreign exchange move paves way to reduce $385 billion reserve stash (Reuters) Brazil’s decision to sell dollars on the spot market for the first time in a decade is a sign the central bank is finally willing to reduce its $385 billion pile of foreign exchange reserves, analysts said.
Market Overview: US 10yr note futures are down -0.024% at 130-30, S&P 500 futures are up 0.85% at 2872.75, Crude oil futures are up 0.51% at $54.75, Gold futures are down -0.5% at $1523.6, DXY is up 0.13% at 98.27, CAD/USD is down -0.12% at 0.752.
| Cda Benchmarks | Yield | Tsy Benchmarks | Yield |
| 2 Year | 1.316% | 2 Year | 1.495% |
| 5 Year | 1.161% | 5 Year | 1.42% |
| 10 Year | 1.112% | 10 Year | 1.529% |
| 30 Year | 1.321% | 30 Year | 1.983% |
US Economic Data
| 08:30 AM | Housing Starts, Jul Survey: 1256k Actual: 1191k Prior: 1253k |
| Housing Starts MoM, Jul Survey: 0.20% Actual: -4.00% Prior: -0.90% | |
| Building Permits, Jul Survey: 1270k Actual: 1336k Prior: 1220k | |
| Building Permits MoM, Jul Survey: 3.10% Actual: 8.4% Prior: -6.10% | |
| 10:00 AM | U. of Mich. Sentiment, Aug P Survey: 97.00 Prior: 98.40 |
Canadian Economic Data
| 08:30 AM | Int’l Securities Transactions, Jun Survey: — Actual: -3.98b Prior: 10.20b |
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
15/08/2019
Market Update
US tsys higher, yields ~1bps lower with the 10Y 1.57% , very heavy overnite volume in TY futures (970k). US equity futures rebounding from earlier losses after China trade retaliation threat. Walmart up 7% pre-mkt on Q2 eps beat & revised outlook. US Retail Sales rose 0.7% – strongest reading since March, vs 0.3% exp. , while the Phili Fed index rose to 16.8 vs 9.5 exp in August. In Canada, GOCs higher, outperforming tsys by 0.5-1bp.
News headlines
Futures Rise on Trade Optimism, Walmart Results: Markets Wrap (Bloomberg) U.S. equity futures rose on trade optimism and results from Walmart Inc. that bolstered confidence in the American consumer. Treasuries resumed their rally on persistent worries about global growth.
TSX futures down as oil prices drop (Reuters) Futures pointed to a lower opening for Canada’s main stock index on Thursday, as recession worries and rising U.S. crude inventories hurt oil prices.
Oil Holds Losses as U.S. Stockpile Gain Adds to Recession Fears (Bloomberg) Oil held losses as a surprise gain in U.S. crude stockpiles added to deepening concerns over the outlook for global demand.
China says it must take counter-measures to latest U.S. tariffs (Reuters) China has to take necessary counter-measures to the latest U.S. tariffs on $300 billion of Chinese goods, the finance ministry said on Thursday.
Euro zone bank share meltdown brings prices to brink of 1980s (Reuters) Negative interest rates, toppling bond yields, greater regulation and rising recession signals have wiped out most of the value of European banks, with their shares now at meltdown prices approaching the days of the Berlin Wall.
Online spending helps UK retail sales grow unexpectedly in July (Reuters) British retail sales unexpectedly edged up in July, helped by the strongest growth in online spending in three years, as consumers continued to support the economy before the Oct. 31 Brexit deadline.
U.S. yield curve remains inverted for second day (Reuters) The U.S. yield curve was inverted for the second straight trading session on Thursday, as investors’ concerns that the world’s biggest economy could be heading for recession deepened. US2US10=RR
Market Overview: US 10yr note futures are up 0.144% at 130-23, S&P 500 futures are up 0.45% at 2853.5, Crude oil futures are down -1.12% at $54.61, Gold futures are down -0.23% at $1524.3, DXY is down -0.09% at 97.896, CAD/USD is down -0.05% at 0.7512.
| Cda Benchmarks | Yield | Tsy Benchmarks | Yield |
| 2 Year | 1.33% | 2 Year | 1.532% |
| 5 Year | 1.174% | 5 Year | 1.458% |
| 10 Year | 1.121% | 10 Year | 1.547% |
| 30 Year | 1.332% | 30 Year | 1.979% |
US Economic Data
| 08:30 AM | Empire Manufacturing, Aug Survey: 2.0 Actual: 4.8 Prior: 4.3 |
| Nonfarm Productivity, 2Q P Survey: 1.40% Actual: 2.30% Prior: 3.40% | |
| Unit Labor Costs, 2Q P Survey: 2.00% Actual:2.40% Prior: -1.60% | |
| Philadelphia Fed Business Outlook, Aug Survey: 9.5 Actual:16.8 Prior: 21.8 | |
| Retail Sales Advance MoM, Jul Survey: 0.30% Actual: 0.7% Prior: 0.40% | |
| Retail Sales Ex Auto MoM, Jul Survey: 0.40% Actual: 1.0% Prior: 0.40% | |
| Retail Sales Ex Auto and Gas, Jul Survey: 0.50% Actual: 0.90% Prior: 0.70% | |
| Initial Jobless Claims, Aug 10 Survey: 212k Actual: 220k Prior: 209k | |
| Continuing Claims, Aug 3 Survey: 1685k Actual: 1726k Prior: 1684k | |
| 09:15 AM | Industrial Production MoM, Jul Survey: 0.10% Prior: 0.00% |
| Capacity Utilization, Jul Survey: 77.80% Prior: 77.90% | |
| 09:45 AM | Bloomberg Consumer Comfort, Aug 11 Survey: — Prior: 62.9 |
| 10:00 AM | NAHB Housing Market Index, Aug Survey: 65 Prior: 65 |
| Business Inventories, Jun Survey: 0.10% Prior: 0.30% | |
| 04:00 PM | Net Long-term TIC Flows, Jun Survey: — Prior: $3.5b |
| Total Net TIC Flows, Jun Survey: — Prior: $32.9b |
Canadian Economic Data
| 09:00 AM | Existing Home Sales MoM, Jul Survey: 3.30% Prior: -0.20% |
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