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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

Market Update

US tsys moving higher with equities lower (S&P -13), US 10Y 2.64% (-0.5bps) as weakness in global stocks continues with the Nikkei -2.05, 4th day down, CSI Comp -4.0%, Europe -1.0%.  GOCs continuing to outperform tsys in the global bond rally, Can/US at new narrows across the curve -88bps in 2s with   2Y yields now 15bps below the o/n rate.  US employment forecast to have risen 180k last month from 304k in Jan with the unemployment rate back below 4.0%.  Cdn emp growth also expected to have decelerated in Feb to 1.2k from 67k In Jan. BOC Deputy Patterson said Q4 growth slowdown was sharper than expected, while economic weakness will likely extend into the first half of the year.  Provi spds wider, yest Ont 29s 79.5/ from 77.5 at issue yest. CMB 5y next week.

News headlines

U.S. economy creates paltry 20,000 jobs in February (Reuters) U.S. job growth almost stalled in February, with the economy creating only 20,000 jobs amid a contraction in payrolls in construction and several other sectors, which could raise concerns about a sharp slowdown in economic activity.

Stock Slide Worsens on Growth Woes as Jobs Loom: Markets Wrap (Bloomberg) U.S. stock futures retreated alongside European equities amid renewed concerns about global growth after a plunge in Chinese stocks set the tone for global markets on Friday. The dollar slipped and Treasuries were steady ahead of American jobs data.

Bank of Canada sees longer economic ‘detour’ than expected (BNN) Canada’s economic slump may end up lasting longer than first thought amid surprising signs of weakness in household spending and investment, though policy makers still expect a rebound to take place, a central bank official said.

China February exports tumble the most in three years, spur fears of ‘trade recession’ (Reuters) China’s exports tumbled the most in three years in February while imports fell for a third straight month, pointing to a further slowdown in the economy and stirring talk of a “trade recession”, despite a spate of support measures.

Growth fears, China equity plunge haunts world stocks (Reuters) Deepening fears for the health of the global economy pushed world stocks to three week lows on Friday after China exports contracted by a fifth, sending shares in some of the country’s key indexes more than 4 percent lower.

Key Fed gauge flashes warning signal for second time this year (BNNBloomberg) A gauge of U.S. economic health closely watched by the Federal Reserve is flashing warning signs for the second time this year. The near-term forward spread, which reflects the difference between the forward rate implied by Treasury bills six quarters from now and the current three-month yield, fell back below zero on Friday for the first time since January. A negative reading shows the market expects monetary policy easing during the next 12 to 18 months.

ECB Officials Defend Stimulus as Move Needed to Arrest Slowdown (Bloomberg) Euro-area officials set out to defend their latest monetary-policy action, stressing their package of new long-term loans and revised guidance was an appropriate response to the region’s economic slowdown.

Overnight markets

Cda Benchmarks	Yield	Tsy Benchmarks	Yield
2 Year	1.599%	2 Year	2.467%
5 Year	1.604%	5 Year	2.432%
10 Year	1.737%	10 Year	2.634%
30 Year	2.048%	30 Year	3.023%

US Economic Data

8:30 AM	Housing Starts, Jan Surv 1195k Prior 1078k
	Building Permits, Jan Surv 1287k Prior 1326k
	Change in Nonfarm Payrolls, Feb Surv 180k  Prior 304k
	Change in Manufact. Payrolls, Feb Surv 12k Prior 13k
	Unemployment Rate, Feb Surv 3.9% Prior 4.0%
	Average Hourly Earnings MoM, Feb Surv 0.3% Prior 0.1%
	Average Hourly Earnings YoY, Surv 3.3% Prior 3.2%

Canadian Economic Data

8:15 AM	Housing Starts, Feb Surv 205.0k Actual 173.2k Prior 208.0k
8:30 AM	Net Change in Employment, Feb Surv 1.2k Prior 66.8k
Unemployment Rate, Feb Surv 5.8% Prior 5.8%
Capacity Utilization Rate, 4Q Surv 82.0% Prior 82.6%

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

US tsys higher, 10Y 2.68% (-2bps) prices at highs of overnite session after ECB decision, will leave rates on hold thru this year at least, announcement of new long-term lending operations. German bund yields 1-2bps lower, 10Y 0.10% closing in on Feb low (0.085%). GOCs higher, in line with tsys, Can/US reaching new narrows after BOC statement, short end of the GOC curve trading below o/n rate. Corp spreads under pressure as supply picks up –  Northwestern Hydro (Al) priced $1.1bln in 2036 & 2038 bonds, Daimler issued $300mln 5Y @ 130.2, and Fortified Trust (BMO)  issued 5Y ABS @89.

News headlines

ECB unleashes support package for economy threatened by slowdown (BNN) The European Central Bank said it will offer more cheap loans to banks and keep interest rates at record-lows for longer as a weakening economy derails its plan to withdraw stimulus.

Futures edge lower as investors await fresh triggers (Reuters) U.S. stock futures ticked lower on Thursday after three days of declines, as investors sought fresh reasons to buy following a strong run in stocks this year.

CANADA STOCKS-Futures edge higher on oil gains (Reuters) Futures pointed to a slightly higher opening for Canada’s main stock index on Thursday as ongoing OPEC-led supply cuts and U.S. sanctions against exporters Venezuela and Iran supported oil prices.

PM admits ‘erosion of trust’ between office, Wilson-Raybould over SNC (BNN) Prime Minister Justin Trudeau says there was an “erosion of trust” between his office and former justice minister Jody Wilson-Raybould over the SNC-Lavalin case.

U.S. Futures, Europe Stocks Edge Up on Dovish ECB: Markets Wrap (Bloomberg) U.S. futures and European stocks erased losses as the ECB took a dovish turn at its latest policy meeting, underscoring concerns over the global economy but raising hopes policy makers will move to support growth. The euro fell.

Loonie drops to two-month low after Bank of Canada changes tone (BNN)  The Canadian dollar tumbled to the weakest level since the opening days of 2019, and the nation’s government-bond yields sank, after the Bank of Canada dropped its assertion that interest rates need to rise amid signs of slowing economic growth.

Overnight markets

Cda Benchmarks	Yield	Tsy Benchmarks	Yield
2 Year	1.665%	2 Year	2.508%
5 Year	1.684%	5 Year	2.486%
10 Year	1.814%	10 Year	2.681%
30 Year	2.107%	30 Year	3.062%

US Economic Data

7:30 AM	Challenger Job Cuts YoY, Feb Actual 117.2% Prior 18.7%
8:30 AM	Initial Jobless Claims, Mar 2 Surv 225k Actual 223k Prior 225k
8:30 AM	Continuing Claims, Feb 23 Surv 1772k Actual 1755k Prior 1805k
Nonfarm Productivity, 4Q Surv 1.5% Actual 1.9% Prior 2.3%
9:45 AM	Bloomberg Consumer Comfort, Mar 3 Prior 61.0
3:00 PM	Consumer Credit,  Jan Surv $17.000b Prior $16.554b

Canadian Economic Data

8:30 AM

Building Permits MoM, Jan Surv -5.0% Actual -5.5% Prior 6.0%

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