Canada’s main stock index opened higher on Wednesday, lifted by energy shares which tracked higher oil prices, while hopes that the coronavirus outbreak could be peaking in the United States helped broader sentiment.
At 9:32 a.m. ET, the Toronto Stock Exchange’s S&P/TSX composite index was up 120.42 points, or 0.88%, at 13,734.56.
Wall Street’s main indexes opened higher on Wednesday for the third straight session, on hopes that the coronavirus outbreak in the United States was nearing its peak and expectations the Congress will push through more aid for the battered economy.
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The Dow Jones Industrial Average rose 239.61 points, or 1.06%, at the open to 22,893.47.
The S&P 500 opened higher by 25.59 points, or 0.96%, at 2,685.00. The Nasdaq Composite gained 88.46 points, or 1.12%, to 7,975.72 at the opening bell.
President Donald Trump said late on Tuesday that the United States might be getting to the top of the “curve” of the outbreak, even as New York and several other states posted their highest number of daily virus-related fatalities.
“Traders are trying to pick a bottom in shares and scientists are trying to pick the peak in the pandemic. Both exercises typically result in a lot of false starts before the real thing,” Jasper Lawler, head of research at London Capital Group said.
Sentiment also got a lift as Democratic leaders in Congress threw their support behind interim emergency funding, a day after the Trump administration asked lawmakers for $250 billion in aid for small businesses hit by the pandemic.
The package would add to the $2.3 trillion in stimulus already approved and meant to make up for the wages and incomes lost after Americans were ordered to stay home to control the spread of the virus.
Those measures have brought the economy to a virtual halt, with the benchmark S&P 500 down nearly 22%, or about $6 trillion in market value, from its record high in mid-February, despite the recent gains.
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In Asia, Japan’s state of emergency kicked in and focused on seven urban areas, including Tokyo, with strong government requests for people to stay home and restaurants and stores to close for a month. It was unclear how effective the entirely voluntary measures would be.
Japan’s Nikkei 225 gained 2.1% to 19,353.24, on stronger than expected machinery orders.
Goldman Sachs said in a report that Japan’s economy is headed to a record 25% contraction in the current quarter, with exports diving by 60% in the April-June period. The contraction for the world’s third largest economy would be a record, since GDP, or gross domestic product, began to be tracked in 1955.
Japan’s economic activity will likely recover with the third quarter and GDP is expected to grow 3.1% in 2021, it said.
Benchmark U.S. crude oil rose 81 cents to $24.44 a barrel Wednesday in electronic trading on the New York Mercantile Exchange. It got a boost from comments by President Donald Trump to Fox TV that he expects Russia and Saudi Arabia to resolve their price war. U.S. crude had fallen $2.45, or 9.4%, to settle at $23.63 per barrel Tuesday.
Brent crude, the international standard, gained 16 cents to $32.03 on Wednesday.
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While many investors are preoccupied with the pandemic, energy remains another major factor driving trading.
The meeting of the so-called OPEC+ is due to be held on Thursday. It was delayed amid bickering between Saudi Arabia and Russia following a meeting in March where OPEC and other nations led by Russia failed to agree to a production cut to reflect collapsing demand due to the pandemic. Prices then plunged.
Even Thursday’s meeting was in doubt after Iran demanded greater clarity on the scale of U.S. oil production before talks can start.
For “more immediate market stability concerns, all eyes and ears remain trained on the success of the OPEC+ meeting on Thursday,” Stephen Innes of AxiCorp said in a commentary.
In other Asian trading, Australia’s S&P/ASX 200 shed nearly 0.9% to 5,206.90, while South Korea’s Kospi lost 0.9% to 1,807.14. Hong Kong’s Hang Seng fell 1.2% to 23,970.37 and the Shanghai Composite dipped 0.2% to 2,815.37.
India’s Sensex lost 0.6%. Shares rose in Taiwan and Malaysia but fell in other Southeast Asian markets.
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Even though economists say a punishing recession is inevitable, some investors are hoping a peak in new infections might provide clues about how long and durable the downturn might be.
Reuters and The Associated Press
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TOKYO (AP) — Japanese technology group SoftBank swung back to profitability in the July-September quarter, boosted by positive results in its Vision Fund investments.
Tokyo-based SoftBank Group Corp. reported Tuesday a fiscal second quarter profit of nearly 1.18 trillion yen ($7.7 billion), compared with a 931 billion yen loss in the year-earlier period.
Quarterly sales edged up about 6% to nearly 1.77 trillion yen ($11.5 billion).
SoftBank credited income from royalties and licensing related to its holdings in Arm, a computer chip-designing company, whose business spans smartphones, data centers, networking equipment, automotive, consumer electronic devices, and AI applications.
The results were also helped by the absence of losses related to SoftBank’s investment in office-space sharing venture WeWork, which hit the previous fiscal year.
WeWork, which filed for Chapter 11 bankruptcy protection in 2023, emerged from Chapter 11 in June.
SoftBank has benefitted in recent months from rising share prices in some investment, such as U.S.-based e-commerce company Coupang, Chinese mobility provider DiDi Global and Bytedance, the Chinese developer of TikTok.
SoftBank’s financial results tend to swing wildly, partly because of its sprawling investment portfolio that includes search engine Yahoo, Chinese retailer Alibaba, and artificial intelligence company Nvidia.
SoftBank makes investments in a variety of companies that it groups together in a series of Vision Funds.
The company’s founder, Masayoshi Son, is a pioneer in technology investment in Japan. SoftBank Group does not give earnings forecasts.
Shopify Inc. executives brushed off concerns that incoming U.S. President Donald Trump will be a major detriment to many of the company’s merchants.
“There’s nothing in what we’ve heard from Trump, nor would there have been anything from (Democratic candidate) Kamala (Harris), which we think impacts the overall state of new business formation and entrepreneurship,” Shopify’s chief financial officer Jeff Hoffmeister told analysts on a call Tuesday.
“We still feel really good about all the merchants out there, all the entrepreneurs that want to start new businesses and that’s obviously not going to change with the administration.”
Hoffmeister’s comments come a week after Trump, a Republican businessman, trounced Harris in an election that will soon return him to the Oval Office.
On the campaign trail, he threatened to impose tariffs of 60 per cent on imports from China and roughly 10 per cent to 20 per cent on goods from all other countries.
If the president-elect makes good on the promise, many worry the cost of operating will soar for companies, including customers of Shopify, which sells e-commerce software to small businesses but also brands as big as Kylie Cosmetics and Victoria’s Secret.
These merchants may feel they have no choice but to pass on the increases to customers, perhaps sparking more inflation.
If Trump’s tariffs do come to fruition, Shopify’s president Harley Finkelstein pointed out China is “not a huge area” for Shopify.
However, “we can’t anticipate what every presidential administration is going to do,” he cautioned.
He likened the uncertainty facing the business community to the COVID-19 pandemic where Shopify had to help companies migrate online.
“Our job is no matter what comes the way of our merchants, we provide them with tools and service and support for them to navigate it really well,” he said.
Finkelstein was questioned about the forthcoming U.S. leadership change on a call meant to delve into Shopify’s latest earnings, which sent shares soaring 27 per cent to $158.63 shortly after Tuesday’s market open.
The Ottawa-based company, which keeps its books in U.S. dollars, reported US$828 million in net income for its third quarter, up from US$718 million in the same quarter last year, as its revenue rose 26 per cent.
Revenue for the period ended Sept. 30 totalled US$2.16 billion, up from US$1.71 billion a year earlier.
Subscription solutions revenue reached US$610 million, up from US$486 million in the same quarter last year.
Merchant solutions revenue amounted to US$1.55 billion, up from US$1.23 billion.
Shopify’s net income excluding the impact of equity investments totalled US$344 million for the quarter, up from US$173 million in the same quarter last year.
Daniel Chan, a TD Cowen analyst, said the results show Shopify has a leadership position in the e-commerce world and “a continued ability to gain market share.”
In its outlook for its fourth quarter of 2024, the company said it expects revenue to grow at a mid-to-high-twenties percentage rate on a year-over-year basis.
“Q4 guidance suggests Shopify will finish the year strong, with better-than-expected revenue growth and operating margin,” Chan pointed out in a note to investors.
This report by The Canadian Press was first published Nov. 12, 2024.
TORONTO – RioCan Real Estate Investment Trust says it has cut almost 10 per cent of its staff as it deals with a slowdown in the condo market and overall pushes for greater efficiency.
The company says the cuts, which amount to around 60 employees based on its last annual filing, will mean about $9 million in restructuring charges and should translate to about $8 million in annualized cash savings.
The job cuts come as RioCan and others scale back condo development plans as the market softens, but chief executive Jonathan Gitlin says the reductions were from a companywide efficiency effort.
RioCan says it doesn’t plan to start any new construction of mixed-use properties this year and well into 2025 as it adjusts to the shifting market demand.
The company reported a net income of $96.9 million in the third quarter, up from a loss of $73.5 million last year, as it saw a $159 million boost from a favourable change in the fair value of investment properties.
RioCan reported what it says is a record-breaking 97.8 per cent occupancy rate in the quarter including retail committed occupancy of 98.6 per cent.
This report by The Canadian Press was first published Nov. 12, 2024.
