Canadian bonds sag following rally in energy prices; TSX stocks index to open higher

The Canadian government bonds slumped Wednesday following a rally in energy prices. Also, investors will remain keen to focus on the upcoming Q3 GDP data, which is scheduled to be released today later in the day.

The yield on the benchmark 10-year bond, which moves inversely to its price, rose 4-1/2 basis points to 1.55 percent, the yield on long-term 30-year Treasury inched 3-1/2 basis points to 2.12 percent and the yield on short-term 2-year bond bounced 1-1/2 basis points to 0.69 percent by 12:50 GMT.

The Canadian bonds have been closely following developments in oil markets because of their impact on inflation expectations, which are well below the Bank of Canada's target. crude oil prices rallied amid news that oil producing countries will lower its current production in OPEC ministerial gathering at Vienna today.

According to Reuters' source, the OPEC debate now focuses on an output reduction of 1.4 million barrel per day, larger than expected. A source said that non-OPEC might contribute 0.6 million barrel per day, of which 0.4 million from Russia. The International benchmark Brent futures rose 7.59 percent to $50.91 and West Texas Intermediate (WTI) jumped 7.89 percent to $48.80 by 12:40 GMT.

Lastly, Canadian stocks are set to open a stronger session on Wednesday, as rebounding oil prices could drive gains in the energy sector.

The S&P/TSX Composite Index fell 0.10 percent at the close of the trading session to 14,999.81 on Tuesday. While at 12:00 GMT, the FxWirePro's Hourly Canadian Dollar Strength Index remained highly bullish at +100.44 (higher than +75 represents bullish trend).