March 22nd, 2017

Daily Market Commentary




Economic News:

  • The Housing Price Index in the US was reportedly flat in month-over-month terms, below estimates.
  • Existing home sales were quoted at 5.48M in month-over-month terms in the US, below estimates.
  • Mortgage applications in the US in March were down 2.7%.
  • Crude Oil storage reported a build of 4.95M, far above estimates of 2.8M.


  • Canadian stocks fell to their lowest level this year, reversing earlier gains, as oil prices slumped below $48 a barrel and U.S. President Donald Trump’s promised tax cuts looked less likely. The S&P/TSX Composite Index lost 0.8 percent to 15,313.13, its lowest close since Dec. 30. Financial stocks fell 1.2 percent as government bond yields lost ground.
  • Prime Minister Justin Trudeau will try to convince Canadians he’s just as good at generating growth as he is at handing out checks. Bill Morneau, his finance minister, releases a budget at 4 p.m. Ottawa time that will address the country’s lackluster economic performance, and will lay out how the Liberals, who came to power in late 2015, intend to accelerate infrastructure spending and drive innovation.
  • Source Energy Services Ltd., Canada’s largest distributor of fracking sand, postponed its initial public offering, the second Calgary-based fracking-services company to do so in an as many weeks.

United States:

  • The selloff in U.S. equities on Tuesday pushed the CBOE Volatility Index to its biggest jump in almost five weeks, with options traders accelerating wagers for more turbulence ahead. Calls betting on VIX gains saw their highest volume since before the U.K. vote to leave the European Union, trading more than twice as much as puts.
  • The Republican plan to repeal and replace Obamacare is drawing strong opposition just ahead of a crucial House floor vote expected on Thursday, driven by the bill’s cuts to the Medicaid health program for the poor. A group representing major Medicaid insurers said on Tuesday that it has “serious concerns” about the GOP bill, estimated to slash $880 billion from Medicaid.
  • Expanding state aid to money-losing nuclear reactors across the eastern U.S. may leave consumers on the hook for as much as $3.9 billion a year in higher power bills. Nuclear plant owners are seeking subsidies in Ohio, Connecticut, Pennsylvania and New Jersey after Exelon Corp. won state aid for reactors in Illinois and New York last year.


  • European stocks fell, extending a decline that began the previous afternoon, as investors questioned the extent to which U.S. President Donald Trump can deliver on growth policies that have been priced in since his election. The Stoxx Europe 600 Index declined 0.8 percent at 8:28 a.m. in London, heading for its worst back-to-back drop since January.
  • Republican candidate Francois Fillon fell further behind in the French presidential race as satirical newspaper Le Canard Enchaine published details of his financial ties to the Russian government and prosecutors broadened a probe into his affairs.
  • Akzo Nobel NV spurned a sweetened, 22.4 billion-euro ($24.2 billion) takeover offer from PPG Industries Inc., marking the second time that Europe’s largest coatings company has rebuffed an overture from its U.S. competitor.
  • Volkswagen AG is marketing its first major unsecured bond sale in almost two years, betting that investors are willing to draw a line under an emissions-cheating scandal that rocked Europe’s biggest carmaker. The four-part deal comprises euro-denominated notes with maturities as long as 10 years.
  • Asian stocks retreated from a 21-month high after U.S. equities dropped the most since November’s presidential election amid concern that Donald Trump’s growth policies won’t pass Congress.
  • Japan’s exports rose for a third consecutive month in February as strengthening global demand continued to help the nation’s moderate economic recovery. The increase was the biggest in two years, reflecting the timing of Lunar New Year holidays in Asia.
  • China’s central bank injected funds via open-market operations for a third day after the benchmark money rate climbed to the highest level since April 2015 and some smaller lenders were said to fail to make debt payments in the interbank market. The People’s Bank of China pumped in a net 40 billion yuan ($5.8 billion) on Wednesday.

*All sources from Bloomberg unless otherwise specified