Commentaires matinaux

Market Update

Tsys weaker, near bottom of overnight range on weak volume, 10Y 2.62% (+2bps). European equities slightly higher, S&P futures +8, crude higher for a 3rd day 57.40 (+1.0%) after OPEC pledge to stick to cuts and API data showing a surprise drop in crude inventories last week.  Core Euro bonds lower, gilt yields 1bps higher ahead of Brexit vote this aft.  US data includes Feb PPI, Jan durables and $16bln 30Y auction. In Canada, focus on 5Y CMB – June 15 2024 reopening (37/36.5).

News headlines

Equity markets stymied by signs of slowdown, Brexit chaos (Reuters) World shares slipped on Wednesday after two days of gains amid mounting concern over world growth and trade, though the British pound rallied half a percent on optimism that lawmakers were set to rule out a no-deal Brexit.

Brexit crisis deepens as British lawmakers to vote on no-deal exit (Reuters) Britain’s parliament will vote on Wednesday on whether to leave the European Union in 16 days without an agreement as the government said it would eliminate import tariffs on a wide range of goods in a no-deal Brexit scenario.

European shares up on hopes Britain will reject no-deal Brexit (Reuters) European shares gradually edged up in morning trading on Wednesday on expectations that British lawmakers would vote to reject a disorderly no-deal Brexit.

Pompeo calls on oil industry to support U.S. foreign policy agenda (Reuters) U.S. Secretary of State Mike Pompeo urged the oil industry on Tuesday to work with the Trump administration to promote U.S. foreign policy interests, especially in Asia and in Europe, and to punish what he called “bad actors” on the world stage.

Canada, U.S. refuse to join at least 40 countries in grounding Boeing 737 Max 8; Sunwing suspends four planes on its own (GlobeandMail) Canada has not yet grounded the Boeing 737 Max plane despite at least 40 countries across Europe and Asia banning the jet after two deadly crashes in five months.

Oil Extends Gains on OPEC+ Cuts and Signs of U.S. Supply Drop (Bloomberg) Crude rose for a third day after an industry report showed an unexpected drop in U.S. stockpiles just as planned cuts and disruptions to OPEC output are tightening supply.

Gold hits 2-week high as investors seek refuge from Brexit chaos (Reuters) Gold rose to a near two-week peak on Wednesday, holding above the key $1,300 mark as uncertainty over Britain’s exit from the European Union drove investors to safe haven assets.

Overnight markets

Cda Benchmarks	Yield	Tsy Benchmarks	Yield
2 Year	1.659%	2 Year	2.465%
5 Year	1.651%	5 Year	2.429%
10 Year	1.752%	10 Year	2.623%
30 Year	2.039%	30 Year	3.014%

US Economic Data

7:00 AM	MBA Mortgage Applications, Mar 8 Actual 2.3% Prior -2.5%
8:30 AM	PPI Final Demand MoM, Feb Surv 0.2% Prior -0.1%
	PPI Ex Food and Energy MoM, Feb Surv 0.2% Prior 0.3%
	PPI Final Demand YoY, Feb Surv 1.9% Prior 2.0%
	PPI Ex Food and Energy YoY, Feb Surv 2.6% Prior 2.6%
	Durable Goods Orders, Jan P Surv -0.4% Prior 1.2%
	Durables Ex Transportation, Jan P 0.1% Prior 0.1%
	Cap Goods Orders Nondef Ex Air, Jan P Surv 0.2% Prior -1.0%
10:00 AM	Construction Spending MoM, Jan Surv 0.5% Prior -0.6%

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 slightly lower, 10y 2.65 (+1bp) , close to top of o/n range , rallying with bunds/gilts  on comments from UK Attorney General that legal risk to Irish backstop remains unchanged – ahead of key vote on Brexit later today. Feb CPI and $24bln 10Y note auction the focus for US tsys today. CPI expected to show another 0.2% rise in the core, remaining at 2.2% y/y. GOCs lower, in line with tsys, Can/US another 2bps tighter yest, 81bps thru in the 5Y, narrowest since June 2017 right before the BOC embarked on its 125bp rate tightening campaign. CMB 5Y reopening scheduled for Wed (pricing Thurs) – we mentioned in our Provi comment last week that 5Y CMBs look attractive on recent cheapening, and vs Ontarios. Please let us know if you have interest.

News headlines

Futures slightly higher ahead of inflation data (Reuters) U.S. stock index futures inched higher on Tuesday, taking cues from global stocks which rose after last-minute tweaks to Britain’s deal to leave the European Union that eased some fears of a no-deal Brexit, and as investors waited for inflation data.

‘Absurd’ to say Trump unreliable trade negotiator with China: White House (Reuters) The White House said on Monday it was “absurd” to suggest that President Donald Trump was an unreliable negotiator as China reportedly balks at a summit with President Xi Jinping over concerns Trump would walk away from a trade deal.

Rate cut coming with Canada ‘one notch’ from recession: Rosenberg (BNN) The next move from the Bank of Canada will be to cut to interest rates, according to David Rosenberg, who says the economy is just “one notch away” from a recession.

CANADA STOCKS-TSX futures up as oil prices rise (Reuters) Futures pointed to a higher opening for Canada’s main stock index on Tuesday, tracking gains in oil prices.

OECD troubled by allegations Canada meddled in SNC-Lavalin case (Reuters) A major intergovernmental economic group expressed its concern on Monday over allegations the Canadian government tried to interfere in a criminal case against a major construction firm and reminded Ottawa of its promise to respect the independence of prosecutors.

Japan firms wary of wage hike as economy wobbles amid trade war, global slowdown (Reuters) Big Japanese firms are set to offer smaller pay increases this year at annual wage talks on Wednesday as the economy sputters, tempering hopes that domestic consumption will offset external risks to growth.

Pound Drops Before Brexit Vote, Stock Rally Fades: Markets Wrap (Bloomberg) U.S. equity futures edged lower, European stocks turned negative and the pound tumbled after a legal ruling called into question the likelihood of a last-minute breakthrough on Brexit. Treasuries fell and the dollar was steady.

Oil Rises on Tighter Venezuela, Saudi Supplies (Bloomberg) Oil rose to the highest in more than a week after Saudi Arabia was said to plan extending deep supply curbs and a nationwide blackout sparked a production collapse in Venezuela.

Overnight markets

Cda Benchmarks	Yield	Tsy Benchmarks	Yield
2 Year	1.661%	2 Year	2.483%
5 Year	1.648%	5 Year	2.451%
10 Year	1.758%	10 Year	2.648%
30 Year	2.054%	30 Year	3.038%

US Economic Data

6:00 AM	NFIB Small Business Optimism, Feb  Surv 102.5 Actual 101.7 Prior 101.2
8:30 AM	CPI MoM, Feb Surv 0.2% Prior 0.0%
	CPI Ex Food and Energy MoM, Feb Surv 0.2% Prior 0.2%
	CPI YoY, Feb Surv 1.6% Prior 1.6%
	CPI Ex Food and Energy YoY, Feb Surv 2.2% Prior 2.2%
	CPI Core Index SA, Feb Surv 261.193 Prior 260.701
	CPI Index NSA, Feb Surv 252.837 Prior 251.712

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 weaker on avg volume in TY futures (300k), 10Y 2.64% (+1bp). USD index slightly higher, US equities higher (S&P futures +3, Nasdaq +20), Dow futures weighed by the ~8% slide in Boeing (200 dow pts) after the crash of an Ethiopian Air Boeing 737 on Sunday.  Fed chair Powell, on ’60 Minutes’ said the Fed is in no hurry to change rates again.  Crude up 0.70% after comments from Saudi oil minister that an end to OPEC-led prod cuts unlikely before June.  UK 10Y gilts are higher ahead of BOE buyback , Brexit uncertainty also supportive with talks “deadlocked” ahead of vote on Brexit deal Tuesday, the GBP lower for 8th session.  US  data focus on Jan Retail Sales while the US auctions $38bln in 3Y notes this aft, followed by $24bln 10Y Tuesday & $16bln 30Y bonds Wednesday.  In Canada, GOCs unch , 1bp tighter vs tsys across the curve before Confidence data.  Yields across the curve close to three month lows, CGBs saw solid buying into the close Friday after being pressured by the blockbuster Feb employment report (67.4k full-time , 2.2% AHE)

News headlines

Stocks Shake Off Dismal Week, Dollar Edges Higher: Markets Wrap (Bloomberg) Stocks climbed in Europe and Asia and futures for the benchmark U.S. gauge advanced as equity markets sought to shake off the worst week of the year. The dollar nudged higher.

CANADA STOCKS-TSX futures up on higher oil prices (Reuters) Futures pointed to a higher opening for Canada’s main stock index on Monday, buoyed by a rise in oil prices.

S&P, Nasdaq futures edge higher following lackluster week; Boeing pressures Dow (Reuters) The S&P 500 and Nasdaq futures eked out gains on Monday as investors took a cautious stance after a weak U.S. jobs report raised questions of slowing global growth, while a slide in planemaker Boeing’s shares pressured Dow futures.

With budget, Trump throws opening jab in next funding fight with Congress (Reuters) President Donald Trump on Monday will ask lawmakers to hike spending for the military and the wall he wants to build on the U.S.-Mexico border and slash other programs in his 2020 budget, the opening move in his next funding fight with Congress.

China and Indonesia halt Boeing 737 MAX 8 after Ethiopia crash (Reuters) China, Indonesia and Ethiopia grounded their Boeing Co 737 MAX 8 fleets on Monday while investigators found the black box from a crash that killed 157 people in the second disaster involving that airplane model in six months.

Global economy hits its weakest spell since financial crisis (BNN) The global economy’s sharp loss of speed through 2018 has left the pace of expansion the weakest since the global financial crisis a decade ago, according to Bloomberg Economics.

Auto woes drive dip in German industrial output (Reuters) Plunging car production drove an unexpected drop in German industrial output in January, as the engine room of Europe’s largest economy stuttered on trade tensions and unease about Brexit.

UK PM May will give parliament a ‘meaningful’ Brexit vote on Tuesday: spokesman (Reuters) British Prime Minister Theresa May will hold the so-called a meaningful vote on her Brexit deal on Tuesday as planned, her spokesman said after media reports that she could downgrade the status of the vote.

Overnight markets

Cda Benchmarks	Yield	Tsy Benchmarks	Yield
2 Year	1.655%	2 Year	2.475%
5 Year	1.652%	5 Year	2.442%
10 Year	1.766%	10 Year	2.647%
30 Year	2.062%	30 Year	3.036%

US Economic Data

8:30 AM	Retail Sales Advance MoM, Jan Surv 0.0% Prior -1.2%
	Retail Sales Ex Auto MoM, Jan Surv 0.3% Prior -1.8%
	Retail Sales Ex Auto and Gas, Jan Surv 0.6% Prior -1.4%
	Retail Sales Control Group, Jan Surv 0.6% Prior -1.7%
10:00 AM	Business Inventories, Dec Surv 0.6% Prior -0.1%

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