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Market Update

US tsys moving lower after March Durable Goods upside surprise (2.7% vs 0.8% exp), 10Y  2.54. Core Euro bonds mixed, bunds unch while UK gilt yields are ~2.5bps lower, 10Y gilt at two week low 1.15%. Another strong day for the USD index, DXY up for a third day at a two-year high, SEK touched multi decade lows on Swedish Riksbank plan to delay rate hikes. In Canada, GOCs lower, 1bp wider vs tsys in the pullback post data.  At noon the BOC auctions $1.4bln 2% Dec 2051s with benchmark yields 2.0%, the last long auction being October 31st when yields were at a four-year high 2.50%.  The long end has lagged in this latest rate rally, 10s30s reached 32bps yest the widest since Nov 2017, while the 51/48 roll has cheapened ~0.5bps both of which should support the auction.

News headlines

Bank of Canada abandons rate-hike bias amid economic slowdown (BNN) The Bank of Canada fully abandoned its bias toward raising interest rates as the economy grapples with a slowdown, bringing its policy in line with the Federal Reserve and other major industrial central banks.

TSX futures slip tracking global cues (Reuters) Futures for Canada’s main stock index edged lower on Thursday after world equity markets slipped amid global growth worries.

Stocks Mixed as Traders Digest Flood of Earnings: Markets Wrap (Bloomberg) U.S. equity-index futures were mixed on Thursday and European shares edged lower as investors parsed a slew of earnings against a backdrop of global growth concerns. The dollar hit a four-month high.

Brent oil hits $75 for first time in 2019 as Russian exports cut (Reuters) Brent oil rose above $75 per barrel on Thursday for the first time this year as quality concerns forced the suspension of some Russian crude exports to Europe while the United States prepared to tighten sanctions on Iran.

U.S. officials say global oil market ready for end to Iran crude exports (Reuters) U.S. attempts to drive Iranian oil exports down to zero come against the backdrop of a global market that is sufficiently well supplied to avoid price disruptions, senior U.S. officials said on Thursday.

Dow futures hit by 3M results; upbeat tech results support Nasdaq (Reuters) Dow and S&P futures were pressured by a steep fall in industrial company 3M’s shares on Thursday, while upbeat results from high-flying companies Facebook and Microsoft supported Nasdaq futures.

China seeks to allay fears over Belt and Road debt risks (Reuters) China aims to make the Belt and Road initiative sustainable and prevent debt risks, its finance minister said on Thursday, seeking to allay criticism that the infrastructure plan to boost trade and investment creates a heavy burden for some nations.

Overnight markets

Cda Benchmarks	Yield	Tsy Benchmarks	Yield
2 Year	1.533%	2 Year	2.318%
5 Year	1.517%	5 Year	2.317%
10 Year	1.689%	10 Year	2.527%
30 Year	2.006%	30 Year	2.948%

US Economic Data

08:30 AM	Initial Jobless Claims, Apr 20 Survey 200k Actual 230k Prior 192k Revised 193k
	Continuing Claims, Apr 13 Survey 1682k Actual 1655k Prior 1653k Revised 1654k
	Durable Goods Orders, Mar P Survey 0.8%  Actual 2.7% Prior -1.6% Revised -1.1%
	Durables Ex Transportation, Mar P Survey 0.2% Actual 0.4% Prior -0.1% Revised -0.2%
09:45 AM	Bloomberg Consumer Comfort, Apr 21 Survey — Prior 60.3

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 rallying, yields 2-3bps lower, moving higher with German bunds, 10Y 2.54% (-2.5bps), TY futures near top of range on heavy volume (420k), block trade in 5Y futures 6K FVM9 ($283k DV01) at 8:11. Equity futures unch, DOW futures higher with Boeing (+1.7%), even thou the company missed estimates and announced it is pausing share buybacks. Bunds/Gilts higher after Apr IFO missed estimates, current conditions lowest in two years.  GOCs higher, outperforming tsys out the curve by 1-1.5bps, 10Y 1.70% before BOC decision &MPR at 10:00ET.  The overnight rate is expected to remain unch at 1.75%, with the statement likely to remove the tightening bias from March, along with downward adjustment to 2019 GDP growth from 1.7% in Jan. Provi spds unch, Ont 10Y deal yest @ 72 now 72.5/71.5, QC 10s or longs rumoured.  Yest we pointed to the attractive all in  pick selling Ont 23s to buy Ont 28s – 30.8 credit pick is top of 6 mnth range while the underlying 5s10s GOC curve (23s28s) has spiked since April 1st to 16bps (Z-2.8), so a decent flattener play involving Ontarios.

News headlines

Futures dip ahead of BoC’s interest rate decision (Reuters) Futures for Canada’s main stock index inched lower on Wednesday, ahead of Bank of Canada’s interest rate decision and amid a drop in oil prices and global equities.

Stocks Struggle; Bonds Gain as Dollar Strengthens: Markets Wrap (Bloomberg) U.S. equity futures drifted in the wake of Tuesday’s record close, European stocks fluctuated and Asian benchmarks were mixed as investors assessed corporate news and economic data. Treasuries climbed alongside European sovereign bonds and the dollar extended its rally to a six-week high.

Top U.S. officials to hold trade talks in China next week (Reuters) U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin will travel to Beijing for trade talks beginning on April 30, the White House said in a statement on Tuesday.

New round of U.S. tariffs a ‘modest’ hit for euro area: ECB (Reuters) A new round of tariffs between the United States and its main partners would only cause a “modest decrease” in the pace of economic growth in the euro zone, according to research by the European Central Bank.

Bank of Canada’s Poloz poised to put rates on prolonged pause (BNN) Bank of Canada Governor Stephen Poloz is widely expected to cement expectations for a prolonged pause on interest rates on Wednesday, as the nation’s economy grapples with a slowdown.

Oil Slides as U.S. Supplies Allay Fears Over Iran Sanctions (Bloomberg) Oil pulled back from a six-month high as an industry report signaling a gain in U.S. crude inventories partly offset concerns over America’s campaign to halt Iranian exports.

European shares hit highest since August on Credit Suisse, SAP (Reuters) World shares pared back losses on Wednesday as positive earnings in Europe from Credit Suisse and investor support for SAP helped soothe worries that China has put broader stimulus on hold.

Overnight markets

Cda Benchmarks	Yield	Tsy Benchmarks	Yield
2 Year	1.541%	2 Year	2.332%
5 Year	1.526%	5 Year	2.329%
10 Year	1.707%	10 Year	2.538%
30 Year	2.021%	30 Year	2.959%

US Economic Data

07:00 AM

MBA Mortgage Applications, Apr 19 Survey – Actual -7.3% Prior -3.50%

Canadian Economic Data

10:00 AM

Bank of Canada Rate Decision, Apr 24 Survey 1.75% Prior 1.75%

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 slightly lower, down in recent trade as stock futures erase losses (S&P +4), US10Y 2.59%, below avg volume in TY futures (290k).  Second tier data today with Phili Fed non-man index, Richmond Fed & March New Home Sales.  The latter have rebounded 20% since hitting a two year low in Oct, with lower l.t. mortgage rates the main driver. In Canada, 10Y yields ~1.80%, curve continuing to steepen led by 10s, 5s10s +4bps over the week. BOC/MPR tomorrow – expect BOC to leave rates unch – the Bank seems to be caught between a confluence of offsetting factors – firming signs of inflation as well as building slack in the economy and an over indebted housing sector.  In provis, supply from Ont & QC a possibility – spreads holding near recent tights, provi curve steeper along with underlying GOC curve.

News headlines

U.S. may follow China with first quarter GDP upside surprise (Reuters) A temporary government shutdown with no end in sight, rising trade conflicts and a global growth slowdown: the first quarter outlook for the U.S. economy did not look promising at the turn of the year.

TSX futures flat, oil prices continue to rise (Reuters) Futures for Canada’s main stock index were little changed on Tuesday, even though oil prices rose to their highest level since November after the U.S. tightened sanctions on Iran.

Stocks Mixed as Earnings Roll In; Oil Extends Gain: Markets Wrap (Bloomberg) U.S. equity-index futures were range bound, European stocks slipped and Asian shares nudged higher on Tuesday as many markets reopened after a long weekend and as the results season ramps up. Crude extended recent gains.

Oil hits highest since November as U.S. to tighten Iran sanctions (Reuters) Oil prices hit their highest since November on Tuesday after Washington announced all waivers on imports of sanctions-hit Iranian oil would end next week, pressuring importers to stop buying from Tehran and further tightening global supply.

China complains to U.S. over end to Iran oil sanction waivers (Reuters) China’s Foreign Ministry said on Tuesday it has formally complained to the United States over its decision to end waivers on sanctions on Iranian oil imports, adding another fault line to already complicated Beijing-Washington ties.

Dollar gains with FX volatility holding near five-year lows (Reuters) The dollar held near three-week highs on Tuesday as a drop in market volatility ramped up demand for riskier assets, with higher U.S. bond yields also offering some support.

Overnight markets

Cda Benchmarks	Yield	Tsy Benchmarks	Yield
2 Year	1.622%	2 Year	2.391%
5 Year	1.619%	5 Year	2.386%
10 Year	1.798%	10 Year	2.589%
30 Year	2.104%	30 Year	2.997%

US Economic Data

09:00 AM	FHFA House Price Index MoM, Feb Survey 0.50% Prior 0.60%
10:00 AM	Richmond Fed Manufact. Index, Apr Survey 10 Prior 10
	New Home Sales, Mar Survey 649k Prior 667k
	New Home Sales MoM, Mar Survey -2.70% Prior 4.90%

Canadian Economic Data

08:30 AM

Wholesale Trade Sales MoM, Feb Survey 0.10% Prior 0.60%

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