Some French restaurateurs were set to open and serve sit-down meals on Monday to protest ongoing Covid closures. But a government warning that they would lose their right to a solidarity bailout fund has watered down the day of action. Restaurant owners in France have been unable to serve sit-down meals since 30 October. Despite government bailouts of up to €20,000 per month, some say they’re at breaking point, with little prospect of a return to business as usual anytime soon.Last week Stephane Turillon, a chef in eastern France, called for restaurants to open for protest meals on Monday, in a day of civil disobedience.Several chefs and restaurant owners announced they would heed the call. But on Monday morning France’s finance minister, Bruno Le Maire announced very dissuasive measures.”It’s extremely hard for restaurants, economically and in terms of morale,” he told RTL radio, “but in no way does that justify not respecting the rules.”Le Maire said owners caught serving clients would see their Covid solidarity funds suspended for a month, “and if they do it again, they won’t get any more at all.”Speaking on BFMTV, Stéphane Manigold, spokesperson for the “Restons ouverts” (Let’s stay open) collective, immediately called on restaurateurs “not to commit an offence”. Paris police, politicians among ‘fork gangsters’ eating illegally in restaurants Le Maire acknowledged the restaurants planning to defy Covid restrictions were “an isolated few”. But on Saturday, police in Paris said they discovered 24 restaurants operating illicitly on Thursday and Friday, and warned they would step up controls.Daily Le Parisien reported Monday that one restaurant shut down was serving judges who worked at the nearby appeals court on the Ile de la Cité, just opposite the Paris police headquarters.A day of actionFollowing Le Maire’s announcement, Turillon said he had no choice but to stay closed after all. The gendarmes arrived and told him he had to evacuate along with 100 or so people who had already gathered at his restaurant.”I have a family, I can’t afford to deprive them of this financial aid,” he told France Bleu local radio.But Gérard Viau, owner of the Arcade restaurant in France’s southern Ardèche region, said he was sticking with the day of action.“Despite the threats from the government and the fact we know the gendarmes will come, at some point they have to stop treating us like idiots,” he told RFI.“When you look at these big shops people are already on top of one another so I’ve decided to mark a day of action in this way.”More than moneyRestaurants and other businesses that have been forced to close during the health crisis can receive up to €10,000 a month, or compensation equal to 20 percent of their revenues from 2019, capped at €200,000 per month.But many owners say the money still doesn’t make up for lost sales as they have to still have to pay rent. Second lockdown a ‘death knell’ for French restaurants struggling to survive For Viau, it’s not just about money, he says the psychological toll is considerable.“The situation has been going on like this for nearly a year: we’re not working any more, we’ve got nothing, but above all it’s difficult psychologically,” he said. “We’re forced to take pills to deal with that, we’re psychologically weakened. It’s a real body blow: we can’t go out, we can’t do anything anymore.”Someone has to get fired upLast week Christophe Wilson, 50, was detained for questioning after he served lunch to around 100 people in his “Poppies” restaurant in Nice on the Mediterranean coast.People were photographed dropping their masks to enjoy a Provencal stew and other specialities, with some dancing while a band played on the terrace.“Someone needs to get everyone fired up, and if I have to be the one who takes that risk, so be it,” Wilson said.Wilson was taken into custody on Thursday but released, and ordered to appear for a formal reprimand, a light punishment that does not go on a person’s police record.His protest garnered a wave of support on social media, with the hashtag #LiberezChristophe (Free Christophe) trending on Twitter as messages expressed anger over his treatment and the dire financial straits of restaurants.Trying to avoid 3rd lockdownFaced with growing concern over the spread of Covid-19 variants that are believed to be more contagious, Dr. Patrice Pelloux is just one of several doctors who maintains France “will have to lock down again” in addition to the nationwide 6pm to 6 am curfew. But the government appears reluctant to impose another lockdown for the moment, preferring to introduce further restrictions on shops and tighten France’s borders.On Saturday it announced that “non-food shopping centres larger than 20,000 square metres” would have to close from Sunday.Checks will also be reinforced to ensure that the 10m² per customer rule is respected. Failure to do so will incur fines for a first offence, followed by closure.According to Le Maire, some 27,000 additional businesses will now be eligible for the solidarity fund.
Some Quebecers won't have their power back until this weekend, Hydro-Québec says – CBC.ca
Hydro-Québec says crews are still working on restoring power to more than 80,000 customers in the province and that it could take until this weekend to get everyone back on the grid.
Thousands of residents have been left in the dark since Saturday following a fierce spring storm that swept across large swaths of the province, downing trees and power lines.
The most affected region remains the Laurentians, where roughly 50,000 customers are still without electricity. As of Wednesday afternoon, some 18,000 customers in the Lanaudière were without power and more than 15,000 in the Outaouais.
At a news conference Wednesday in Morin-Heights, a small, hard-hit town in the Laurentians, Hydro-Québec president and CEO Sophie Brochu said crews are working “as quickly as possible” to restore power to all households.
“We will not leave until everyone has been reconnected,” she told reporters.
WATCH | Hydro-Québec president explains when power will be restored:
Brochu said the public utility has about 700 crews — or 1,400 people — working around the clock, including crews from private contractors, regions that haven’t been affected by the outages and even some from New Brunswick.
Régis Tellier, vice-president of operations and maintenance at Hydro-Québec, said he hopes to have 50,000 customers reconnected by the end of the day, “but we cannot hope to reconnect all customers before Friday, perhaps even beyond.”
Residents kept in the dark, says mayor
Morin-Heights was battered by Saturday’s storm. Trees were seen toppled over cars and on roofs, and power lines littered the streets.
Mayor Tim Watchorn said as of Wednesday, 75 per cent of residents are still without power. And while the public utility is urging patience, he said people in the community are starting to feel frustrated.
“[Hydro-Québec] can’t give us a timeline as of now,” he said. “People find it difficult not knowing.”
Because many residents rely on wells, even showering and using the washroom is impossible for some. With no internet, phones or stoves, many are left feeling cut off from the world.
“It’s hard to not know what’s happening and when you’re going to get your power back,” Watchorn said.
Chalet Bellevue, the local community centre, has been transformed into an emergency shelter since the weekend storm. A generator has been hooked up allowing people to charge their phones, cook, get water and take showers.
On Wednesday, Patricia Clark was at the community centre trying to download books to read on her iPad. She was grateful to finally plug back in since she hasn’t had power in her home since Saturday afternoon.
“It was very painful throwing out everything in the fridge and the freezer … but Morin-Heights has been excellent though, they give you, you know, everything.”
Downed trees, terrain causing delays
Hydro-Québec says the size of the affected area is a key reason for the delays in getting the light backs on.
The violent storm hit a portion of territory 300 kilometres long by 100 kilometres wide, according to Brochu, ranging from the Outaouais to Quebec City.
She said half a million customers lost power within three to four hours and more than 554,000 customers were without electricity at the height of the event.
“It was crazy,” she said. “Since the ice storm, that’s pretty much the biggest event we’ve seen.”
Brochu said the complex nature of the work to be done in some regions could also pose risks and create complications, causing further delays.
Crews must remove power lines that have fallen to the ground under the weight of uprooted trees, replace hundreds of poles and navigate difficult terrain that sometimes prevents work trucks from getting to the affected areas, she said.
Brochu said repairs in remote areas only restore service to a small number of customers at a time, hence the plateau in the number of customers regaining power.
“We know you’re there, we’re going to work as hard and as fast as we can,” she assured residents.
As of Wednesday afternoon, more than 470,000 customers had had their power restored. The power is back on for all households in the Mauricie, Quebec City and Montreal regions.
Stock market news live updates: Stocks end choppy session higher after FOMC minutes – Yahoo Canada Finance
U.S. stocks pushed higher at the close of a choppy session on Wednesday as investors considered a slew of company warnings on the impact of inflation to earnings alongside the Federal Reserve’s latest communications about using their policies to rein in rising prices. The Fed’s May meeting minutes reaffirmed that central bank officials saw additional 50 basis point rate hikes as appropriate over the next couple meetings.
The S&P 500 wobbled but then gained Wednesday afternoon after the release of the Fed minutes, which also noted that more aggressive tightening and “a restrictive stance of policy may well become appropriate depending on the evolving economic outlook and risks to the outlook.” The Dow and Nasdaq each also rose. Treasury yields mostly declined, and the benchmark 10-year yield fell to hold just above 2.75%.
Investors this week have also eyed a growing list of companies citing the effects that inflation have had and will have on results going forward. Retailers including from Walmart and Target last week to Dick’s Sporting Goods (DKS) and Abercrombie & Fitch (ANF) this week slashed their earnings forecasts for the year as the companies absorbed rising goods and transportation costs. And elsewhere, Snap (SNAP) warned earlier this week that it would post weaker-than-expected sales and profit results this year as the macroeconomic environment “deteriorated further and faster than anticipated.” This was taken as a harbinger of softer results for a bevy of ad-driven tech stocks, sending the Nasdaq Composite to its lowest close since Nov. 2020 on Tuesday.
As the grim company guidance piles up, Wall Street has been looking for signs that the Federal Reserve’s interest rate hikes and monetary policy tightening will achieve bringing down inflationary pressures. The Fed’s minutes from its early May meeting Wednesday afternoon reaffirmed that most monetary policymakers were considering rolling out additional 50 basis point rate hikes at the next two Fed meetings. The Fed raised rates by 50 basis points earlier this month for the first time since 2000, after having raised rates by just 25 basis point earlier this year.
“The challenge right now is we’re in this new chapter of the inflation story. If you’ll recall, last year it started with whether it’s transitory — turns out, it wasn’t. Then it became about the Fed at the end of last year and earlier this year, whether or not they would tighten significantly. And they did, and now all that’s priced in,” James Liu Clearnomics founder and CEO, told Yahoo Finance Live. “And now what the market is looking at is are basically the fundamentals around how inflation affects corporate profitability and consumer demand.”
And beyond the domestic concerns, a myriad of international concerns — from Russia’s war in Ukraine, to China’s ongoing COVID outbreak — have further infused volatility into the market.
“The Fed can’t really do anything about what’s going on between Russia and Ukraine, they can’t really do anything about China’s COVID zero policies … and a lot of traders are starting to get concerned,” Shawn Cruz, TD Ameritrade head trading strategist, told Yahoo Finance Live.
“The way the market to me is reacting to that, is one, there’s de-leveraging going on. There are some liquidation events out there as well, and that is one of those ‘selling begets more selling’ type of environments. And then the other one is, there’s just not enough confidence out there to come in there and meaningfully put money back to work,” he added. “Once you start to see leverage start going back up, cash coming in from the sidelines, that to me would be an indication that there is at least a little bit more certainty in the outlook for a lot of these people on the sidelines to come back in.”
4:05 p.m. ET: Stocks end choppy session higher after Fed minutes: Nasdaq gains 1.5%, Dow adds 192 points, or 0.6%
Here were the main moves in markets as of 4:05 p.m. ET:
S&P 500 (^GSPC): +37.25 (+0.95%) to 3,978.73
Dow (^DJI): +191.66 (+0.60%) to 32,120.28
Nasdaq (^IXIC): +170.29 (+1.51%) to 11,434.74
Crude (CL=F): +$0.97 (+0.88%) to $110.74 a barrel
Gold (GC=F): -$11.80 (-0.63%) to $1,853.60 per ounce
10-year Treasury (^TNX): -1.1 bps to yield 2.7490%
2:15 p.m. ET: Fed minutes show support for another two half-point rate hikes while adding ‘a restrictive stance of policy’ could become appropriate
The Federal Reserve’s latest meeting minutes Wednesday afternoon reaffirmed Fed Chair Jerome Powell’s prior assertions that the central bank was weighing two more half-point rate hikes.
“Most participants judged that 50 basis point increases in the target range would likely be appropriate at the next couple of meetings,” according to the minutes. “Many participants assessed that the Committee’s previous communications had been helpful in shifting market expectations regarding the policy outlook into better alignment with the Committee’s assessment and had contributed to the tightening of financial conditions.”
The Fed left room for further policy decisions to be informed by incoming data on the economy, which has recently softened. However, it also emphasized that its primary goal remained on bringing down inflation, and that as a result, a “restrictive stance of policy” could be needed.
“Participants agreed that the economic outlook was highly uncertain and that policy decisions should be data dependent and focused on returning inflation to the Committee’s 2% goal while sustaining strong labor market conditions,” the minutes noted. “At present, participants judged that it was important to move expeditiously to a more neutral monetary policy stance. They also noted that a restrictive stance of policy may well become appropriate depending on the evolving economic outlook and the risks to the outlook.”
11:11 a.m. ET: Stocks extend gains, Nasdaq rises by 1%
Here were the main moves in markets as of 11:11 a.m. ET:
S&P 500 (^GSPC): +23.35 (+0.59%) to 3,964.83
Dow (^DJI): +87.30 (+0.27%) to 32,015.92
Nasdaq (^IXIC): +110.02 (+0.98%) to 11,374.47
Crude (CL=F): +$0.22 (+0.20%) to $109.99 a barrel
Gold (GC=F): -$17.20 (-0.92%) to $1,848.20 per ounce
10-year Treasury (^TNX): -0.9 bps to yield 2.7510%
9:31 a.m. ET: Stocks open lower before shaking off losses
Here were the main moves in markets as of 9:31 a.m. ET:
S&P 500 (^GSPC): -9.53 (-0.24%) to 3,931.95
Dow (^DJI): -114.27 (-0.36%) to 31,814.35
Nasdaq (^IXIC): -22.24 (-0.20%) to 11,242.21
Crude (CL=F): +$0.89 (+0.81%) to $110.66 a barrel
Gold (GC=F): -$13.90 (-0.75%) to $1,851.50 per ounce
10-year Treasury (^TNX): -2.6 bps to yield 2.7340%
9:12 a.m. ET: Durable goods orders disappoint in April
U.S. durable goods orders decelerated in April and were downwardly revised in March, offering an at least early sign that businesses may be pulling back on investments as economic uncertainties mount.
Orders for durable goods, or manufactured products intended to last at least three years, rose by 0.3% in April compared to March, the Commerce Department said Wednesday. This came in below the 0.6% rate consensus economists were expecting, according to Bloomberg data. In March, durable goods orders rose by 0.6%, with this rate revised down from the 1.1% previously reported.
Non-defense capital goods orders excluding aircraft also missed expectations, rising by 0.3% in April versus the 0.5% anticipated. This metric rose by 1.1% in March, and serves as a closely watched proxy for business investment. Still, non-defense capital goods shipments excluding aircraft, which factors into GDP, rose by a better-than-expected 0.8% last month.
“It’s entirely possible that the recent slowing is nothing more than a temporary reaction to the spike in energy prices; firms might be waiting to see how consumers respond,” Ian Shepherdson, chief economist at Pantheon Macroeconomics, wrote in an email about the report. “So far, we see no evidence of any hit — housing excepted — but we also can’t rule out the idea higher rates are directly causing some capex [capital expenditures] to be deferred, even though firms are sitting on huge piles of cash accumulated during the pandemic.”
“For now, a decent increase in capital spending on equipment in the second quarter seems assured, given the lags from previous strength in orders, but the outlook for H2 has become a bit more cloudy,” he added.
7:55 a.m. ET: Dick’s Sporting Goods becomes latest retailer to slash full-year outlook given ‘evolving macroeconomic conditions’
Dick’s Sporting Goods shares sank by more than 14% Wednesday morning after the retailer became one of the latest to lower its full-year earnings and sales guidance as economic uncertainty resurged.
The sporting goods retailer said it now sees adjusted earnings totaling between $9.15 and $11.70 per share for the 2023 fiscal year, with this range coming in well below the $11.70 to $13.10 a share seen previously. Comparable store sales will likely fall between 2% and 8% this year, the company added, compared to a prior outlook for sales to come in between unchanged and down 4%. Dick’s Sporting Goods said it updated its outlook “to reflect the impact of evolving macroeconomic conditions,” according to its earnings release Wednesday morning.
Following the release, the stock was on track to post a sixth straight day of losses, or its longest losing streak since early Dec. 2021, as shares fell in sympathy with other major retailers over the past week.
7:23 a.m. ET: Stock futures edge lower
Here’s where markets were trading Wednesday morning:
S&P 500 futures (ES=F): -5.25 points (-0.13%) to 3,935.25
Dow futures (YM=F): -55 points (-0.17%) to 31,825.00
Nasdaq futures (NQ=F): -9.5 points (-0.08%) to 11,761.50
Crude (CL=F): +$1.47 (+1.34%) to $111.24
Gold (GC=F): -$14.10 (-0.76%) to $1,851.30 per ounce
10-year Treasury (^TNX): -2.6 bps to yield 2.734%
Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter.
Bankers buck gloomy trend by forecasting growth amid concerns about economic slowdown – The Globe and Mail
Top executives at two major Canadian banks predict they can keep adding new loans and increasing profits in the coming quarters, offering an optimistic outlook for the financial sector that is at odds with economists’ increasingly gloomy forecasts of a downturn ahead.
Bank of Nova Scotia BNS-T and Bank of Montreal BMO-T both reported higher second-quarter profits on Wednesday, underpinned by robust demand for personal and commercial loans as well as lower loan loss reserves than analysts anticipated. Profits increased 12 per cent compared with those in the same quarter a year earlier at Scotiabank, and 4 per cent after adjustments at BMO, as rising interest rates helped increase margins on loans.
That marked a strong start to the major banks’ earnings season, but analysts cautioned those results, which cover the three months ended April 30, already look distant in the rear-view mirror. They pressed senior executives about how the banks are bracing for a deteriorating economic environment marked by war in Ukraine, high inflation, rapid central bank rate hikes and the increasing prospect of a recession that could curb customers’ appetite to borrow.
Bank chief executives and finance chiefs stressed they still expect economies to grow as COVID-19-related headwinds ease. They noted that most households are in good financial health, as many stashed away extra savings during the pandemic, while unemployment remains low in a tight labour market. Businesses are borrowing to bulk up inventories as demand for products outstrips supply, and some sectors, such as commodities, are booming.
“The macroeconomic backdrop for our key geographies remains positive,” said Scotiabank chief executive Brian Porter, on a conference call with analysts on Wednesday. “Despite the macroeconomic and geopolitical uncertainties in recent months, we are encouraged by the resilience of our businesses.”
The mood among economists is much more downbeat as the threat of a global recession mounts, even though few are predicting that is highly likely. The tone has also been sombre as business leaders and policy makers rub elbows at the World Economic Forum’s gathering in Davos. And the former governor of Canada’s central bank, Stephen Poloz, recently predicted the country is heading for a period of stagflation – a mix of slow growth and high inflation.
Yet increases in banks’ loan balances have been broad-based, and BMO chief financial officer Tayfun Tuzun said in an interview that he still expects “high-single-digit loan growth” year over year – the same guidance he gave three months ago.
“All in all our clients are telling us that they’re still interested in investing in their businesses,” said Mr. Tuzun. He added that there are “a lot of good indicators for what’s to come” for the bank.
A particular bright spot is commercial lending in Canada, where loan balances rose 13 per cent at BMO and 19 per cent at Scotiabank in the second quarter. Scotiabank’s chief financial officer, Raj Viswanthan, said corporate clients and consumers have “very strong” balance sheets at the moment, “so we see a lot of pent up demand.”
The disruptions caused by COVID-19 and war in Ukraine have also increased demand in key areas, Mr. Viswanathan said. “It’s supply chain issues, it’s the rise of e-commerce, it’s the demand for food.”
Bankers aren’t blind to the gathering economic storm clouds. BMO chief risk officer Pat Cronin said his bank is giving greater weight to a hypothetical scenario that predicts the impact of a severe downturn, and has lowered expectations for parts of its forecast it considers the base case.
When U.S. banking giant JPMorgan Chase & Co. hosted an investor day this week, chief executive Jamie Dimon summed up the outlook as, “strong economy, big storm clouds,” saying those clouds “may dissipate. If it was a hurricane, I would tell you that.” But he acknowledged “they may not dissipate, so we’re not wishful thinkers.”
The Bank of Canada published a paper this month that suggests the country’s banks are strong enough and well capitalized to withstand even a severe, prolonged downturn in which unemployment peaks at 13.5 per cent and house prices fall 29 per cent.
Gabriel Dechaine, an analyst at National Bank Financial Inc., wrote to clients that, “in a normal environment, such optimism would be met with positive expectations for stock price appreciation,” but he remains “more cautious … as long as the disruptive forces of inflation that heighten recession expectations persist.”
In the fiscal second quarter, Scotiabank earned $2.75-billion, or $2.16 per share, compared with $2.46-billion, or $1.88 per share, in the same quarter last year. Adjusted to exclude certain items, Scotiabank said it earned $2.18 per share, well above the consensus estimate of $1.98 per share among analysts, according to Refinitiv.
In the same quarter, BMO earned $4.76-billion, or $7.13 per share, compared with $1.3-billion, or $1.91 per share, a year earlier. After adjusting to exclude one-time items that include a $2.6-billion gain on a financial instrument tied to BMO’s US$16.3-billion acquisition of California-based Bank of the West, profit was $2.187-billion, or $3.23 per share. On average, analysts expected $3.24 per share on an adjusted basis.
Both banks raised their quarterly dividends, by 3 cents per share to $1.03 at Scotiabank, and by 6 cents per share to $1.39 at BMO.
Two key factors that have supported banks’ rising profits through much of the pandemic – rapidly rising mortgage balances and unusually low losses from defaulting loans – appear to have reached peaks, and are set to return to more normal levels.
Mortgage balances rose 16 per cent year over year at Scotiabank and 8 per cent at BMO, benefitting from the tail end of a red-hot streak for housing markets. But that yearly growth rate is “slowly slowing,” said Dan Rees, Scotiabank’s head of Canadian banking, and is likely to revert to a pace in the range of 6 to 9 per cent in the coming quarters even as some economists are predicting housing prices will fall.
Provisions for credit losses – the funds banks set aside to cover losses in case loans default – “reached the floor this quarter,” said Phil Thomas, Scotiabank’s chief risk officer. He and his BMO counterpart, Mr. Cronin, expect loan loss reserves will gradually drift higher. But with write-offs and delinquencies still very low, neither risk officer is predicting a spike in loan losses, even though it will rapidly get more expensive for consumers to service their debts.
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