Pumpjacks draw oil out of the ground near Olds, Alta. on July 16, 2020.
Jeff McIntosh/The Canadian Press
Echelon Wealth Partners Inc. is expanding its investment banking business to Western Canada even as many other dealers are undergoing cuts in the region as a result of the energy-industry downturn.
A new Calgary office – Echelon’s first capital markets operation west of Toronto – will serve oil and gas clients, but also concentrate on sectors such as power generation, renewable energy and clean tech.
Echelon has hired investment banker Ryan Mooney as its new managing director to lead the effort. His territory will also include Vancouver and Edmonton. Mr. Mooney is an energy specialist who was previously at Cormark Securities and the former Dundee Capital Markets.
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“Echelon is a growing firm, and we are trying to add sector coverage and add product coverage materially right now, so if we can make a play in energy, if we can make a play in hydrogen or geothermal, all of it’s great as long as we make it opportunistically,” said Karanjit Bhugra, Echelon’s co-head of capital markets.
“We’re looking to double our business in a couple years, and hiring people like Ryan is going to be instrumental to doing that.”
In September, the dealer brought on another oil and gas veteran, Simon Akit, as head of institutional sales and trading in its Toronto office. Mr. Akit had been global head of energy sales at Canaccord Genuity Group Inc., where he worked for 12 years.
The Alberta-based energy sector remains under intense pressure owing to the effects of the COVID-19 pandemic, which exacerbated a half-decade downturn that followed a drop in crude oil prices. That has prompted cuts at several investment banks with operations in Calgary.
The most recent staff reductions were at Stifel Canada, which last week laid off five people in its Calgary office, including veteran investment banking and research professionals.
Mr. Bhugra pointed out that Echelon is not looking to add a full complement of staff to the new Calgary office, but will support Mr. Mooney with its resources in Toronto.
Analysts and bankers expect mergers and acquisitions to pick up in the coming months as many small and mid-size oil producers struggle with sharp reductions in cash flow and heavy debt. But Mr. Bhugra said Echelon sees value in expanding the scope of the franchise to encompass other energy sources expected to play major roles in the shift to a greener economy.
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Although late to the transition, the Alberta government has recently established financial incentives for diversifying its fossil-fuel denominated economy into other related energy sources, such as hydrogen and geothermal.
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TORONTO – Canada’s main stock index was down more than 200 points in late-morning trading, weighed down by losses in the technology, base metal and energy sectors, while U.S. stock markets also fell.
The S&P/TSX composite index was down 239.24 points at 22,749.04.
In New York, the Dow Jones industrial average was down 312.36 points at 40,443.39. The S&P 500 index was down 80.94 points at 5,422.47, while the Nasdaq composite was down 380.17 points at 16,747.49.
The Canadian dollar traded for 73.80 cents US compared with 74.00 cents US on Thursday.
The October crude oil contract was down US$1.07 at US$68.08 per barrel and the October natural gas contract was up less than a penny at US$2.26 per mmBTU.
The December gold contract was down US$2.10 at US$2,541.00 an ounce and the December copper contract was down four cents at US$4.10 a pound.
This report by The Canadian Press was first published Sept. 6, 2024.
TORONTO – Canada’s main stock index was up more than 150 points in late-morning trading, helped by strength in technology, financial and energy stocks, while U.S. stock markets also pushed higher.
The S&P/TSX composite index was up 171.41 points at 23,298.39.
In New York, the Dow Jones industrial average was up 278.37 points at 41,369.79. The S&P 500 index was up 38.17 points at 5,630.35, while the Nasdaq composite was up 177.15 points at 17,733.18.
The Canadian dollar traded for 74.19 cents US compared with 74.23 cents US on Wednesday.
The October crude oil contract was up US$1.75 at US$76.27 per barrel and the October natural gas contract was up less than a penny at US$2.10 per mmBTU.
The December gold contract was up US$18.70 at US$2,556.50 an ounce and the December copper contract was down less than a penny at US$4.22 a pound.
This report by The Canadian Press was first published Aug. 29, 2024.
The crypto market has recently experienced a significant downturn, mirroring broader risk asset sell-offs. Over the past week, Bitcoin’s price dropped by 24%, reaching $53,000, while Ethereum plummeted nearly a third to $2,340. Major altcoins also suffered, with Cardano down 27.7%, Solana 36.2%, Dogecoin 34.6%, XRP 23.1%, Shiba Inu 30.1%, and BNB 25.7%.
The severe downturn in the crypto market appears to be part of a broader flight to safety, triggered by disappointing economic data. A worse-than-expected unemployment report on Friday marked the beginning of a technical recession, as defined by the Sahm Rule. This rule identifies a recession when the three-month average unemployment rate rises by at least half a percentage point from its lowest point in the past year.
Friday’s figures met this threshold, signaling an abrupt economic downshift. Consequently, investors sought safer assets, leading to declines in major stock indices: the S&P 500 dropped 2%, the Nasdaq 2.5%, and the Dow 1.5%. This trend continued into Monday with further sell-offs overseas.
The crypto market’s rapid decline raises questions about its role as either a speculative asset or a hedge against inflation and recession. Despite hopes that crypto could act as a risk hedge, the recent crash suggests it remains a speculative investment.
Since the downturn, the crypto market has seen its largest three-day sell-off in nearly a year, losing over $500 billion in market value. According to CoinGlass data, this bloodbath wiped out more than $1 billion in leveraged positions within the last 24 hours, including $365 million in Bitcoin and $348 million in Ether.
Khushboo Khullar of Lightning Ventures, speaking to Bloomberg, argued that the crypto sell-off is part of a broader liquidity panic as traders rush to cover margin calls. Khullar views this as a temporary sell-off, presenting a potential buying opportunity.
Josh Gilbert, an eToro market analyst, supports Khullar’s perspective, suggesting that the expected Federal Reserve rate cuts could benefit crypto assets. “Crypto assets have sold off, but many investors will see an opportunity. We see Federal Reserve rate cuts, which are now likely to come sharper than expected, as hugely positive for crypto assets,” Gilbert told Coindesk.
Despite the recent volatility, crypto continues to make strides toward mainstream acceptance. Notably, Morgan Stanley will allow its advisors to offer Bitcoin ETFs starting Wednesday. This follows more than half a year after the introduction of the first Bitcoin ETF. The investment bank will enable over 15,000 of its financial advisors to sell BlackRock’s IBIT and Fidelity’s FBTC. This move is seen as a significant step toward the “mainstreamization” of crypto, given the lengthy regulatory and company processes in major investment banks.
The recent crypto market downturn highlights its volatility and the broader economic concerns affecting all risk assets. While some analysts see the current situation as a temporary sell-off and a buying opportunity, others caution against the speculative nature of crypto. As the market evolves, its role as a mainstream alternative asset continues to grow, marked by increasing institutional acceptance and new investment opportunities.
