Daily Market Commentary

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Get a complete view of the world as seen through the eyes of our investment professionals each and every business day shortly after the opening bell.

The information contained herein is intended for advisors for general information only and is compiled from sources believed to be reliable, but no representation or warranty, express or implied, is made as to its accuracy. All opinions contained in the commentary and expressed by the portfolio manager are subject to change without notice and are provided in good faith without legal responsibility. All market data is sourced from Bloomberg.​​​​​

  • President Trump's threatened new tariffs continue to concern markets this morning...

    Thursday, May 24, 2018 - 10:03 EDT
    President Trump threatened new tariffs continue to concern markets this morning, as headlines indicate that they would include impacts to China. Trump is pushing for additional tariffs on imported cars and trucks into the U.S., deeming them a risk to national security. 
  • Geopolitical concerns have increased once again...

    Wednesday, May 23, 2018 - 10:10 EDT
    Geopolitical concerns have increased once again following news yesterday that President Trump would reconsider penalties on the Chinese company ZTE.  This follows a previous announcement from Trump to reduce the ban on the company and allow ZTE to operate in the U.S.
  • North American economic data releases this week are relatively sparse

    Tuesday, May 22, 2018 - 09:50 EDT
    North American economic data releases this week are relatively sparse. Most notable though will be the FOMC minutes from the May meeting on Wednesday. With a 96.7% probability of a June rate hike already priced in, the market is looking for indications of the pace of future hikes in the minutes.
  • Y-O-Y Canadian CPI slipped in April

    Friday, May 18, 2018 - 09:53 EDT
    Year-over-year Canadian CPI slipped in April to 2.2% from 2.3% in March. The deceleration was primary due to a combination of base effects, gas prices and seasonality.
  • The yield curve in Canada continues to flatten

    Thursday, May 17, 2018 - 09:00 EDT
    The yield curve in Canada continues to flatten with 30 year bond yields inverting this morning against the 10-year bond.  30-year Canada bond yields are approximately 0.25bps lower than 10-year yields.  U.S. Treasury yields have also grinded higher over the past week after several attempts to stay above the 3% range.   
  • Yesterday, U.S. 10 year treasury yields reached a seven year high

    Wednesday, May 16, 2018 - 09:39 EDT
    Markets this morning are largely overlooking the potential cancellation of U.S-North Korea summit, seeing the rhetoric largely as a negotiation tactic. Yesterday, U.S. 10 year treasury yields reached a seven-year high, peaking at 3.09%, and remain at 3.065%.  
  • U.S. retail sales for April increased by 0.3%

    Tuesday, May 15, 2018 - 09:05 EDT
    U.S. retail sales for April increased by 0.3%, which was in-line with expectations.  April’s increase was driven by rising fuel costs in the U.S. with gasoline prices nearing the highest prices since 2014. 
  • The tone on both the equity and fixed income markets remains constructive

    Monday, May 14, 2018 - 09:12 EDT
    The tone in both the equity and fixed income markets remains constructive this morning following last week’s global rally.  However, equity markets in Europe are down marginally following comments from the ECB, that are being interpreted as slightly hawkish. 
  • Canadian employment for April fell by 1.1k

    Friday, May 11, 2018 - 09:02 EDT
    Canadian employment for April fell by 1.1k, which was below expectations for an increase of +20k.  This follows a strong increase last month of +32k.  All of the jobs lost were part-time, as Canada added 28.8k full-time jobs offset by a loss of -30k part-time jobs. 
  • U.S. headline inflation for April increased by 2.5%

    Thursday, May 10, 2018 - 09:18 EDT
    U.S. headline inflation for April increased by 2.5%, which was in line with expectations.  Prices of used automobiles declined the most since 2009 while airfares dropped by the largest margin over the past four years. 
  • Oil prices are surging higher this morning

    Wednesday, May 9, 2018 - 08:54 EDT
    Oil prices are surging higher this morning at just over $71/barrel following an announcement yesterday from President Trump that the U.S. plans to step away from the previous nuclear deal with Iran.  U.S. companies will no longer be able to engage in new deals with Iranian oil and energy sector companies. 
  • Boc Deputy Governor spoke yesterday regarding the world economic outlook

    Tuesday, May 8, 2018 - 09:08 EDT
    Bank of Canada Deputy Governor Lane spoke yesterday on a panel regarding the world economic outlook and noted that growth has been very unevenly globally.
  • The tone remains positive this morning, despite...

    Monday, May 7, 2018 - 09:14 EDT
    The tone remains positive this morning despite the possibility that the U.S. will reinitiate sanctions on Iran. 
  • U.S. non-farm payrolls in April increased by 126k

    Friday, May 4, 2018 - 09:18 EDT
    U.S. non-farm payrolls in April increased by 164k, which was below expectations of 193k jobs added.  Two month revisions increased by 30k, which helped to offset last month’s lackluster increase of +103k.
  • The FOMC's monetary policy announcement yesterday left rates unchanged

    Thursday, May 3, 2018 - 09:15 EDT
    The FOMC’s monetary policy announcement yesterday left rates unchanged, although the Fed did acknowledge that inflation has moved closer to its 2% target. 
  • The FOMC will announce its monetray policy decision this afternoon

    Wednesday, May 2, 2018 - 09:04 EDT
    U.S. headline inflation for March declined by 0.1%, which was below expectations of a flat reading.  On a year over year basis, headline inflation is tracking at 2.4%. 
  • Canadian GDP for February increased by 0.4%

    Tuesday, May 1, 2018 - 09:13 EDT
    Canadian GDP for February increased by 0.4%, which was above expectations of 0.3%.  On a year over year basis, growth in Canada is tracking 3.0%.
  • U.S. Core PCE for March inbcreased to 1.9%

    Monday, April 30, 2018 - 09:01 EDT
    U.S. Core PCE for March increased to 1.9% from 1.6% last month, which is now closer to the FOMC’s 2.0% target.  Although personal consumption was slow to start the year, it is expected to gain momentum with March personal spending outpacing income growth. 
  • U.S. GDP for the first quarter came in above expectations

    Friday, April 27, 2018 - 09:14 EDT
    U.S. GDP for the first quarter came in above expectations.  The first look at Q1 2018 annualized GDP was reported at 2.3%, with consensus estimates at 2.0%.  Despite a decline from Q4 2017 GDP growth of 2.9%, this morning’s first quarter data is the strongest comparable period increase since 2015.
  • U.S. durable goods for March came in at 2.6%

    Thursday, April 26, 2018 - 09:00 EDT
    U.S. durable goods for March came in at 2.6% for the month, which was stronger than expectations of +1.6%.  Positively, last month’s data was also revised higher from 3.0% to 3.5%.  The increase in durable goods orders was primarily driven by commercial aircraft orders that jumped 45%.  Excluding transportation, durable goods orders were flat for the month with shipments of non-defense capital goods ex.
  • All three countries in NAFTA indicated yesterday that negotiations were making progress

    Wednesday, April 25, 2018 - 09:05 EDT
    All three countries in NAFTA indicated yesterday that negotiations were making progress.  President Trump implied that talks are going well and trade representatives in all three countries have ramped up efforts in Washington.  High level meetings are expected to continue today and tomorrow.  The trade head for the Mexican business chamber noted in an interview yesterday that an agreement could be made in the next ten days.  Although he believes if no deal is made in the coming days, NAFTA negotiations could be halted until the Mexican Presidential election is complete.&
  • BOC Governor Poloz indicated that inflation remains on target

    Tuesday, April 24, 2018 - 09:24 EDT
    Bank of Canada Governor Poloz appeared before the House Standing Committee on Finance yesterday and indicated that inflation in Canada remains on target as the economy is close to potential.  Similar to the recent monetary policy statement, Poloz reiterated that factors driving inflation higher are temporary - driven by recent minimum wage increases.  Ultimately, higher rates will be warranted over time as Deputy Governor Wilkens noted that real estate markets are rebounding and signs of speculation have declined.  The BOC will still require a year to assess the impacts of th
  • Yields in both Canada and the U.S. continued to track higher..

    Monday, April 23, 2018 - 08:49 EDT
    Yields in both Canada and the U.S. continued to track higher last week as fears eased that an impending trade war would transpire between the U.S. and China.  U.S. 10-year Treasury yields last hit the 3% range at the end of 2013 with yields this morning just above 2.97%.  The Canadian 10-year yield started the month at 2.09% and currently stands at 2.35% supported by higher oil prices. 
  • Canadian CPI for March increased by 0.3%

    Friday, April 20, 2018 - 09:39 EDT
    Canadian CPI for March increased by 0.3%, just below expectations of 0.4%.  On a year over year basis, headline inflation is running at 2.3%.  Although CPI is above the Bank of Canada’s 2% target, it missed economist expectations for higher inflation.  Prices increased across all major categories with the exception of clothing.  Mortgage interest costs increased by 2.8% for the month, as a result of higher interest rates, and gas prices also continuing to push inflation higher in Canada.  The common measure of core inflation increased by 1.9%, while the median and t
  • The Bank of Canada left its policy rate unchanged at 1.25% yesterday...

    Thursday, April 19, 2018 - 09:32 EDT
    The Bank of Canada left its policy rate unchanged at 1.25% yesterday.  The Bank continues to watch inflation as headline CPI is tracking close to 2%, with core inflation also increasing to that level.  However, some of the factors, including higher gasoline prices and recent minimum wage hikes, are expected to be transitory.  Escalating geopolitical and trade conflicts remain key risks with the BOC revising down 2018 growth by 0.2% to 2%, as a result of weaker first quarter data.  Uncertainty surrounding NAFTA has also constrained business investment.  During the pr
  • Yesterday, Moody's placed the Province of Ontario on negative outlook

    Wednesday, April 18, 2018 - 09:00 EDT
    The Bank of Canada releases its monetary policy report this morning, although it is expected that the Bank will leave rates unchanged at 1.25%.  The previous statement highlighted risks surrounding trade, especially the ongoing NAFTA negotiations, which continued to add uncertainty to the Canadian economic outlook.  Housing was also a concern for the BOC, as new mortgage rules are expected to temper the rate of household spending this year.  Markets are only pricing in a 20% chance of a hike this meeting; although the tone of the statement is not expected to be overly dovish,
  • U.S. Treasury Secretary, Mnuchin, spoke this morning....

    Tuesday, April 17, 2018 - 09:35 EDT
    U.S. Treasury Secretary Mnuchin spoke this morning and indicated that the new tax system is leading to stronger economic growth, which will help to offset the temporary shortfall in tax receipts.  Overall, Mnuchin is comfortable with the higher sustained economic growth that should be within the 3% range.  Meeting with executives, Mnuchin is optimistic that companies are looking to invest money back into the U.S.
  • U.S. retail sales for March increased by 0.6%...

    Monday, April 16, 2018 - 09:21 EDT
    U.S.
  • The focus today will be on U.S. bank earnings...

    Friday, April 13, 2018 - 09:32 EDT
    The focus today will be on U.S. bank earnings, with JP Morgan and Citigroup announcing this morning.
  • The FOMC released the minutes from its March meeting yesterday...

    Thursday, April 12, 2018 - 09:42 EDT
    The FOMC released the minutes from its March meeting yesterday afternoon that, indicating that the Fed is gaining confidence that inflation will soon return to its 2% target.  Members were willing to look through the softer Q1 economic data, which is expected to be transitory.  The tax reform enacted to start the year is expected to provide a significant boost to output over the next few years, although higher budget deficits and interest rates could lead to downside risks.  Overall, as shown in the dot plot chart, it was appropriate to set a slightly steeper path for the Fed
  • U.S. headline inflation for March declined by 0.1%...

    Wednesday, April 11, 2018 - 09:35 EDT
    U.S. headline inflation for March declined by 0.1%, which was below expectations of a flat reading.  On a year over year basis, headline inflation is tracking at 2.4%.  Mobile phone prices rebounded, after a decline of 0.5% in the previous month, while energy prices fell by 2.8%, which was the largest decline since 2016.
  • Headlines regarding trade between China and the U.S. continue to be in focus...

    Tuesday, April 10, 2018 - 10:00 EDT
    Headlines regarding trade between China and the U.S. continue to be in focus this morning, following President Xi’s speech that stressed the importance of globalization rather than returning to a “Cold War mentality”.  China reaffirmed its pledge to open up its financial sector, endorse lower foreign ownership rules, cut tariffs on car imports and, more importantly, enforcing greater intellectual property protection.
  • The Trump administration tried to calm fears of an impending trade war ...

    Monday, April 9, 2018 - 11:58 EDT
    Following Friday’s announcement by the U.S. to impose additional tariffs on Chinese imported goods, the Trump administration tried to calm fears of an impending trade war over the weekend.  President Trump does not expect China to actually follow through on their $50 billion of retaliatory tariffs on U.S. imported goods that target soybeans and pork.  Despite the U.S.
  • U.S. non-farm payrolls added 103k jobs in March...

    Friday, April 6, 2018 - 09:36 EDT
    U.S. non-farm payrolls added 103k jobs in March, which was below the market expectations of 185k, and significantly lower than 326k gain in February. The March payroll growth was the worst in six months. However, average hourly earnings ticked higher to 2.7%, and the unemployment rate remained at 4.1%, the lowest level since 2000.  In March, Canada added 32k jobs, which is better than the market expectation of 20k. The headline numbers masks the 68k full time jobs created, which fully offset the 36k loss of part-time jobs.
  • Equity markets recovered yesterday afternoon...

    Thursday, April 5, 2018 - 08:56 EDT
    Equity markets recovered yesterday afternoon as concerns eased around a potential trade war between the U.S. and China.  Trade representatives from both sides indicated that there is room for negotiation to avoid the proposed tariffs.  These taxes are not expected to take effect for a couple months giving both countries additional time to come to an agreement. St.
  • Fears of a full-blown trade war continue to mount this morning...

    Wednesday, April 4, 2018 - 09:29 EDT
    Fears of a full-blown trade war continue to mount this morning after China announced a fresh round of tariffs on U.S. imported goods.  The scale of these new measures matches the size put in place by the U.S. at approximately $50 billion that will see an additional 25% tax on products such as soybeans, automobiles and aircrafts.  Despite China’s previous rhetoric to engage the U.S. in discussion to resolve the dispute, the additional tariffs surprised many investors following the duty on 128 U.S.
  • Volatility remained a theme yesterday...

    Tuesday, April 3, 2018 - 08:56 EDT
    Volatility remained a theme yesterday with most U.S. equity indices moving back into correction territory.  Most of the focus persisted around a potential trade war after China implemented tariffs on U.S.
  • China has implemented its measures in response to the $50 billion tariffs....

    Monday, April 2, 2018 - 09:37 EDT
    China has implemented its measures in response to the $50 billion tariffs announced by the U.S. last month.  Although China and the U.S. were in the middle of negotiations that included protecting American intellectual property, the Chinese Commerce Ministry indicated that the U.S. did not respond to China’s request for consultation on the recently announced steel and aluminum tariffs that provided countries the ability to apply for an exemption.  China continues to advocate for open dialogue with the U.S.
  • The Ontario government released its budget yesterday ...

    Thursday, March 29, 2018 - 10:02 EDT
    The Ontario government released its budget yesterday that will see the province return to a deficit.  Leading up to the June election, the Liberals will enact additional spending programs that will focus on lowering healthcare and dental costs, along with free daycare.  The projected deficit for 2018/19 will be $6.7bil, with a similar shortfall for the next year.  This will represent a higher net debt to GDP ratio of 37.6% moving to 39% in 2021/22.
  • Growth is expected to remain positive in the U.S. this year...

    Wednesday, March 28, 2018 - 09:54 EDT
    Growth is expected to remain positive in the U.S. this year, as a result of tax reform that will drive business investment. The third reading of Q4 U.S.
  • The tone continues to be positive this morning...

    Tuesday, March 27, 2018 - 09:39 EDT
    The tone continues to be positive this morning, as fears of a global trade war continue to ease.  European markets are up over 1%, with North American equity futures pointing towards a positive open this morning.  U.S. White House official Navarro commented on the recent dispute and noted that the U.S. is actively engaged with China on fixing the trade gap.  Overall, despite the potential tariffs, he still sees growth for the U.S.
  • The selloff in the equity markets continued...

    Monday, March 26, 2018 - 09:01 EDT
    The selloff in the equity markets continued on Friday on fears of a global trade dispute.  The TSX was lower by 1.14% and the S&P500 down by 2.10%.  The tone this morning is cautiously optimistic following news from Treasury Secretary Mnuchin indicating a deal could be made with China to avoid the previously announced $50 billion of tariffs on Chinese imported goods.  China has noted that it will retaliate against the U.S. tariffs by taxing approximately $3 billion of U.S.
  • Equity markets sold off yesterday...

    Friday, March 23, 2018 - 09:07 EDT
    Equity markets sold off yesterday with the S&P500 lower by 2.52% and the TSX down by 1.76%.  President Trump announced that he plans to unveil up to $60 billion of tariffs on Chinese imported goods into the United States.  The U.S. is accusing China for intellectual property theft and could levy taxes up to 25%.  Trump is also vying for support from trade allies including Europe and Japan to place additional pressure on China.  This morning, fears of a trade war continue to be fueled by China’s response by taxing up to $3 billion of U.S. imported goods. 
  • The FOMC raise the Fed Funds rate by 25bps...

    Thursday, March 22, 2018 - 09:05 EDT
    As expected, the FOMC raised the Fed Funds rate by 25bps yesterday, although the statement held a more dovish tone than investors were expecting leading up to the policy announcement.  The rhetoric was changed to indicate that economic activity is now running at a “moderate rate” compared to “solid rate” in the previous statement.  The median dot plot chart continues to signal an additional two rate hikes in 2018, with both headline and core inflation running below the two percent target on a 12-month basis.  However, inflation should stabilize towards the Fed’s target over t
  • The Canadian dollar is strengthening this morning...

    Wednesday, March 21, 2018 - 08:52 EDT
    The Canadian dollar is strengthening this morning following reports yesterday that the Trump administration plans to eliminate the expectation that vehicles made in Canada and Mexico contain at least 50% U.S. content as part of the ongoing NAFTA negotiations.  This demand has been one of the most contentious topics related to the NAFTA talks, which is providing optimism that the three countries can now move forward to reach an agreement.  As a result, the Canadian government yields are also 2-3bps higher across the curve with the 10-year Canadian yields currently at 2.23%.
  • There were reports that the Trump administration plans to impose a $60 billion tariff on Chinese imported goods

    Tuesday, March 20, 2018 - 09:09 EDT
    There were reports late yesterday that the Trump administration plans to impose a $60 billion tariff on Chinese imported goods, which is stoking renewed worries that the U.S. will embark on trade wars against its partners.  Throughout Trump’s presidential campaign, he has indicated that the U.S. has held a large trade deficit with China, although some business leaders have warned that imposing tariffs will increase costs for companies as well as prices for consumers.  At the current junction, Premier Li has indicated that China will work with the U.S.
  • The focus this week will be on the Federal Reserve

    Monday, March 19, 2018 - 08:56 EDT
    The focus this week will be on the Federal Reserve, which will hold its policy announcement on Wednesday.  This is Jerome Powell’s first FOMC meeting, with investors expecting the Fed Funds rate to increase by 25bps.  Implied probabilities this morning are pricing a 100% chance that the Fed will raise rates.  Economic data has been mixed to start the year; however last month’s jobs data continued to show strength.  More importantly, the tone of the statement along with the press conference will be important as Powell has indicated that he is open to increasing rates four
  • The U.S. dollar continued to strengthen against the Canadian dollar...

    Thursday, March 15, 2018 - 08:56 EDT
    The U.S. dollar continued to strengthen against the Canadian dollar yesterday, currently sitting just below $1.31 USD/CAD.  Speculation that President Trump has removed his National Security Advisor McMaster is increasing worries that Trump will continue to embark on trade wars.  This follows recent events that included the firing of Tillerson and Cohn resigning.
  • U.S. retail sales for February fell by 01%..

    Wednesday, March 14, 2018 - 09:39 EDT
    U.S. retail sales for February fell by 0.1% which was below expectations of 0.3%.  Despite the weaker data, last month’s number was revised higher by 0.2% to 0.1%.  Purchases of automobiles fell by 0.9%, which is the second straight month of declines, reinforcing that auto sales may decline following record numbers over the past several years.
  • U.S. CPI for February increased by 0.2% for the month...

    Tuesday, March 13, 2018 - 09:05 EDT
    U.S. CPI for February increased by 0.2% for the month, which matched expectations. This is a slight decline from last month’s increase of 0.5%, with year-over-year headline inflation tracking at 2.2% in February.  Inflation continues to creep steadily higher with increases broadly across all sectors.

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