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A roundup of what The Globe and Mail’s market strategist Scott Barlow is reading today on the Web

Employment data was released at 8:30 a.m. (ET) Friday for both sides of the border. Domestically, job creation came in roughly as expected with 9,300 new jobs versus 10,000 expected. In the U.S., 312,000 new jobs were reported when 184,000 was forecast.

U.S. unemployment ticked higher but early indications are this was caused by more people entering the work force, an economic positive. Wage growth at 3.2 per cent year over year was above the 3 per cent estimated and while this is good for U.S. economic growth it is not good for corporate profit margins and might affect the equity market open.


Jason Kirby argues that Canada’s housing price correction is underway in Macleans magazine,

““Today, everything has stalled,” [real estate investor Kirk Marsh] says … “There’s just nobody showing up at the open houses now” . .. “Maybe it’s just a moment and the market will rebound again like it has in the past, but maybe this is finally the perfect storm,” says Steve Saretsky, a Vancouver real estate agent. “I think we’re seeing the catalyst for a correction that everyone’s been talking about for 10 years” … Canada’s interest rate might still seem low at 1.75 per cent, but households are now paying nearly 15 per cent more in interest payments on mortgages and consumer debt than they were just a year ago, according to Statscan data. That’s the quickest pace that interest payments have grown since 2006, and it’s nearly 10 times faster than the post-recession average.”

“This is how Canada’s housing correction begins: Canadians are finally getting a taste of what a world with rising interest rates will look like” – Kirby, Macleans

“@JohnPasalis The Toronto area real estate market ends 2018 with 77,426 sales – the last time we saw this volume of sales (outside of the 2008 recession) was in 2003 – it was a bit surprising to see stability in prices and inventory levels in 2018 despite this big decline in sales” – Twitter

“ Loonie, one of the big losers of 2018, remains 'expensive,' experts say” – CBC

“ @vsualst Rationality returning to the Canadian dollar exchange rate – at jawdropping speed” – (chart) Twitter


The Financial Times warns that risks to global crude demand are intensifying,

“While it is always risky to take one data point in isolation, the size of the fall in the [U.S. purchasing managers’] index – from 59.3 to 54.1 – caught oil traders’ attention, with crude immediately wiping out its gains for the day in the minutes following the ISM release.Though a reading above 50 still indicates continued expansion, markets, including oil, appear particularly receptive right now to bad news. Oil traders will pay additional attention to macroeconomic data in the coming weeks.”

“Demand worries suddenly get real for oil market” – Financial Times (paywall)

“OPEC oil output posts biggest drop since 2017 on Saudi move” – Reuters

See also: “@MylesUdland .@Lavorgnanomics highlights another “since 2016” stat from today’s ISM report – new orders fall to lowest since August 2016. More “since 2016” numbers here:… “ – Twitter


Merrill Lynch’s new report on investor asset flows concludes that it’s ‘time to buy.’ I don’t have the full report (yet), only a summary,

“Time to Buy: BofAML Bull & Bear Indicator falls to 1.8, i.e. “extreme bear” reading, triggering 1st “buy” signal for risk assets since June'16 (BREXIT); note BofAML Bull & Bear Indicator triggered “sell” signal Jan'18… Big flow capitulation: record outflows in past six weeks in equities ($84bn) & IG bonds ($34bn); compare with record government bond inflows ($24bn) past six weeks.”

“@SBarlow_ROB ML: "Time to buy" – (research excerpt) Twitter


Tweet of the Day: “ @CNBC “We’re in a sick market,” UBS' Art Cashin said. He said that the market was very healthy in the first three-quarters of 2018, but now weakness is beginning to develop. “ – (video) Twitter

Diversion: China recently landed a probe on the dark side of the moon, “ Why the Far Side of the Moon Matters So Much” – The Atlantic

Newsletter: “This is not the time to catch a falling knife” – Globe Investor

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