U.S. non-farm payrolls saw an increase of 313k in February

Posted: Friday, March 9, 2018 - 09:39 EST

U.S. non-farm payrolls saw an increase of 313k jobs in February, the highest job increase since mid-2016. The strong job growth was in-line with low initial jobless claims, strong ISM factory jobs growth, and strong ADP results. However, weaker than expected wage growth remained a downward risk. February’s average hourly earnings at 2.6% was under the 2.8% survey median, and 2.9% in January. The Canadian Labour Force Survey saw an increase of 15k jobs in February. Unlike the 137k drop in January, this increase was in-line with the longer term average gain of around 20k. However, the details were weaker than the headline, with a 39k loss of full time jobs and 55k increase in part time jobs. The jobless rate improved from 5.9% to 5.8%.

Yesterday was another active day in the Canadian corporate credit market, even without new supplies. Healthy two way trading continued despite the market digesting the recent new issuances, including $700 million from BCE, $1.3 billion from Choice REIT and $600 million from Mondelez International. Spreads generally closed 1 bps tighter across sectors. Of note, Deposit Notes and NVCC outperformed the market and closed 1-2 bps tighter.

Equity Markets:

 

  Index Level % Change QTD YTD Q3 2016 Q4 2016 Q1 2017 Q2 2017 Q3 2017 Q4 2017
S&P 500 2,738.97 0.45% 2.84% 2.84% 3.85% 3.82% 6.07% 3.09% 4.48% 6.64%
TSX

15,538.70

0.43% -3.69%

-3.69%

5.45% 4.53% 2.41% -1.64% 3.68% 4.44%

Rates:

 

Today

% Change

QTD change

YTD change

Sept 30 2016

Dec 31 2016

Mar 31 2016

June 30 2017

Sept 30  2017

Dec 31  2017

Canada 5 Year

2.056%

0.01% 0.19% 0.19% 0.615% 1.150% 1.119% 1.393% 1.753% 1.866%
Canada 10 Year 2.248% 0.01% 0.20% 0.20% 0.990% 1.750% 1.625% 1.762% 2.099% 2.045%
Canada 30 Year 2.426% 0.01% 0.16% 0.16% 1.658% 2.350% 2.302% 2.148% 2.472% 2.266%
30yr Generic Corporate A rated Spread 1.210% 0.00% 0.00% 0.00% 1.530% 1.390% 1.330% 1.210% 1.240% 1.210%
30yr All-in Corporate A rated Yield

3.636%

0.01% 0.16% 0.16% 3.188% 3.740% 3.632% 3.358% 3.712% 3.476%
US 10 Year 2.890% 0.03% 0.48% 0.48% 1.60% 2.50% 2.39% 2.31% 2.33% 2.41%
CDX IG 55.359 -0.761               7

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.