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Equities
U.S. stock futures signalled steep losses early Thursday as the rising number of cases of the coronavirus around the globe continues to fuel market volatility even as central banks take action. In Europe, major markets were down sharply in morning trading. On Bay Street, TSX futures were also weaker with crude prices relatively steady as OPEC and its allies await Russian support for a plan to deepen current production cuts.
So far this week, the Federal Reserve and the Bank of Canada have both cut interest rates by half a percentage point, citing the negative economic impact of the virus. Markets have also priced in a 90-per-cent chance that the European Central Bank will also cut its key rate next week. Although the Dow and S&P rallied more than 5 per cent on Wednesday while the TSX jumped more than 350 points, analysts warn that central bank moves alone won’t ease market concerns.
“It is clear, investors around the world now believe that the monetary policy alone cannot tackle another financial crisis, given that the starting point for the interest rates is already extremely low and rock-bottom interest rates prove to be increasingly inefficient to fuel investment,” Ipek Ozkardeskaya, Senior Analyst at Swissquote Bank, said.
U.S. markets drew some additional support on Wednesday after Washington announced an $8-billion spending plan to help fight the spread of the virus. The IMF also announced a $50-billion aid package.
On the corporate side, Canadian Natural Resources raised its quarterly dividend to 42.5 cents a share, from 37.5 cents. The move came as the company reported adjusted earnings of $686-million or 58 cents per diluted share from operations for the quarter compared with an adjusted loss from operations of $255-million or 21 cents per diluted share in the same quarter a year earlier. Analysts on average had expected an adjusted profit of 70 cents per diluted share for the quarter, according to financial markets data firm Refinitiv.
After Wednesday’s close, MEG Energy Corp. reported earnings per share of 9 cents on quarterly revenue of $992-million. Analysts had been looking for earnings of 9 cents on revenue of $817.9-million in the quarter. MEG also said its full-year free cash flow totalled $528-million.
Elsewhere, cannabis producer Canopy Growth Corp. says it will close two greenhouses in British Columbia and lay off 500 employees as it looks to slow its cash burn and bring its production in line with lower-than-expected demand. The moves are expected to result in a pretax charge of between $700-million and $800-million, the company said.
Overseas, major European markets were down in morning trading. The pan-European STOXX 600 fell 1.13 per cent, reversing course after a positive start. Britain’s FTSE 100 was down 1.66 per cent. Germany’s DAX fell 1.28 per cent. France’s CAC 40 lost 1.46 per cent.
In Asia, major indexes ended higher, taking their cue from Wednesday’s surge on Wall Street. Japan’s Nikkei rose 1.09 per cent. The Shanghai Composite Index gained 1.99 per cent and Hong Kong’s Hang Seng advanced 2.08 per cent.
Commodities
Crude prices steadied as markets await the outcome of a meeting of OPEC and its allies aimed at considering further production cuts to offset the impact of the spread of the coronavirus on demand.
The day range on Brent so far is US$50.71 to US$52.04. The range on West Texas Intermediate is US$46.42 to US$47.57.
Early Thursday, Iran’s oil minister confirmed that OPEC ministers had agreed an extra 1.5 million barrel per day cut in oil production and that Iran was still exempt from the reduction. However, Russia, the biggest of the non-OPEC producers in the OPEC+ group, has yet to give its backing to the move.
Russia’s energy minister returned to Moscow on Wednesday for consultations but was due back in Vienna for the broader OPEC+ meeting on Friday, according to Reuters. So far Russia has been reluctant to support calls for deeper cuts.
Russia’s energy minister returned to Moscow on Wednesday for consultations but was due back in Vienna for the broader OPEC+ meeting on Friday, according to Reuters. So far Russia has been reluctant to support calls for deeper cuts.
“Crude oil prices are starting to give back early gains as it becomes apparent that there are differences of opinion about the level of production cuts at today’s OPEC+ meeting,” Michael Hewson, chief market analyst with CMC Markets U.K., said early Thursday.
AxiCorp strategist Stephen Innes says Russia appears to favour limiting the OPEC+ response to keeping current production cuts in place.
“The enormous glaring issue is that while cuts will help normalize oil demand and inventories later this year, they can’t prevent an already-started considerable oil inventory accumulation in both the U.S. and China,” Mr. Innes said.
Gold prices, meanwhile, edged higher as investors again shifted to ward safer holdings.
Spot gold was up 0.2 per cent at US$1,637.89 per ounce. U.S. gold futures were down 0.3 per cent at US$1,638.70.
“(The virus) has spread to over 80 countries and tensions are escalating day-by-day; investors don’t know what will happen next and they prefer investing in gold because of its safe-haven appeal,” Hareesh V, head of commodity research at Geojit Financial Services, told Reuters.
Currencies
The Canadian dollar was down in early going after the Bank of Canada cut interest rates by a half percentage point and signalled it was prepared to go further is the coronavirus crisis deepens.
The day range on the loonie so far is 74.57 US cents to 74.72 US cents.
In Wednesday’s policy announcement, the central bank cited “a material negative shock” to the Canadian and global outlooks as a result of the spread of the virus.
“As it stands, the CAD has weathered the rate cut with a fair degree of civility,” Shawn Osborne, chief FX strategist for Scotiabank, said in a note issued after the central bank’s announcement.
He said, given that weaker growth and lower energy prices had markets already leaning toward the idea of a rate cut, the only big question going into Wednesday’s policy announcement was how big the central bank’s move would be.
“But with about 40-45 basis points of a 50-basis-point cut priced in ahead of decision time, even that was not a great surprise,” he said. “A dovish policy statement leaves the door wide open to another cut in the next few weeks, we think.”
On Thursday afternoon, Bank of Canada governor Stephen Poloz delivers the bank’s economic progress report during remarks in Toronto. The speech will be followed by a news conference, with markets paying close attention for hints about the bank’s likely moves in the future.
On global markets, the U.S. dollar struggled as traders price in more moves by the Federal Reserve. That central bank made reference to the virus more than 40 times in its Beige Book, released Wednesday afternoon.
Money markets were pricing in another 25-basis-point cut at the next Fed meeting on March 18-19 and a 50 basis point cut by April.
The U.S. dollar remained close to the two-month low of 1.1214 it reached against the euro on Tuesday, last trading 0.4 per cent lower at 1.1175. The dollar was also down against the yen, falling 0.7 per cent to 106.81 , a five-month low.
In bonds, the yield on the U.S. 10-year note again slipped back below 1 per cent. The yield on the note was at 0.963 per cent just before 6 a.m. ET.
More company news
HP Inc on Thursday rejected Xerox Holdings Corp’s raised bid of about US$35-billion, saying that the offer still undervalued the personal computer maker. The U.S. printer maker had increased its offer last month by US$2 to US$24 per share, following rejections of its previous buyout offers by the PC maker. “Our message to HP shareholders is clear: the Xerox offer undervalues HP and disproportionately benefits Xerox shareholders at the expense of HP shareholders,” Chip Bergh, chair of HP’s board, said on Thursday.
German fashion house Hugo Boss warned that the coronavirus will have a significant impact on its first-quarter results, with sales falling particularly in Asia, but also in other key markets. Hugo Boss said it expects a gradual normalization by the middle of the year and forecast that currency-adjusted sales will rise from zero to 2 per cent for the full year, including a single digit decline in Asia/Pacific.
Economic news
(8:30 a.m. ET) U.S. initial jobless claims for week of Feb. 29. Estimate is 215,000, down 4,000 from the previous week.
(8:30 a.m. ET) U.S. productivity for Q4. Consensus is an annualized rate rise of 1.3 per cent.
(10 a.m. ET) U.S. factory orders for January. Consensus is a decline of 0.2 per cent from December.
(12:45 p.m. ET) Bank of Canada Governor Stephen Poloz presents the Economic Progress Report in Toronto.
With Reuters and The Canadian Press
Alberta’s minister of forestry and parks said the RCMP national security investigation team is involved in a probe looking into what caused a pipeline to rupture and catch fire west of Edmonton earlier this week.
On Tuesday, a wildfire was sparked following a natural gas pipeline rupture about 40 kilometres northwest of Edson, Alta. The fire has since been deemed under control.
“We have no indication of any kind of cause on that fire yet; the investigation is happening,” Forestry and Parks Minister Todd Loewen said at a wildfire-related news conference Thursday morning. “The national security investigation team of the RCMP are investigating the cause.
“My understanding, since the cause was unknown, that’s standard practice for them to come in on anything that’s unknown.”
RCMP said as of Tuesday, initial reports had shown no signs of foul play.
Global News has reached out to the RCMP for more information. On its website, the RCMP states it has a wide range of national security-related mandates and responsibilities. It says its national security criminal investigations program involves critical infrastructure protection and critical incident management.
Officials say the investigation into what caused the TC Energy pipeline to break could take months or even years.
The Canada Energy Regulator had investigators on site on Wednesday. The Transportation Safety Board of Canada is also investigating the incident.
The rupture sparked a blaze that could be seen for kilometres, sending large flames and plumes of smoke into the air.
More on Science and Tech
No injuries were reported, and officials said the fire was never a threat to any surrounding communities.
“I want to commend the Yellowhead County Fire Department, industry and our wildfire team for the timely manner that this fire was brought under control,” Loewen said Thursday.
“Fast information sharing between all parties facilitated an effective wildfire response.”
The wildfire sparked by the pipeline rupture is located about 28 kilometres northeast of Obed Lake. More than 30 firefighters were expected to be in the area Thursday to continue working on the wildfire.
— with files from The Canadian Press
— more to come…
© 2024 Global News, a division of Corus Entertainment Inc.
A St. John’s woman says she won’t be paying many more visits to Tim Hortons, after an email from the coffee chain led her to believe that she’d won a new boat — when she hadn’t won anything at all.
“I go to Tim’s quite a lot, seven days a week. I’m afraid now that’s going to change to no days a week,” Carol Evans told CBC News on Thursday.
Evans said she received an email from Tim Hortons on Wednesday afternoon while on a break from her work as an licensed practical nurse.
The email recapped the prizes she’d won in the annual Roll Up the Rim to Win contest, but there was one extra prize included — a brand new boat and trailer, valued at about $55,000.
Unfortunately, the excitement was over by the time she got home from work.
“I was just so excited, really excited. I thought I really won a boat and a trailer, $55,000 worth, and to find out at five to six, I had an email from them come in telling me it was a technical error,” she said.
“I don’t get my boat and I don’t get my trailer.”
Carol Evans of St. John’s was elated when she got an email from Tim Hortons saying she won $55,000 worth of prizes. Another email from the coffee giant a few hours later, telling her it was an error, had her crushed — and fuming.
Evans said her win was the talk of her co-workers.
“I work with about a hundred people in the run of a day, and more than that outside the OR, and everybody was so happy for me. They couldn’t believe it, I finally won something in my life,” she said.
“But to find out a few hours later I didn’t, it was disappointing, very disappointing.… I cried, it was so sad.”
Although she may not have taken it out on the water, Evans said winning would have meant a lot to her, like helping fund her retirement after more than five decades in nursing.
“I could have sold the boat and trailer and had some money, paid off some bills, probably could have, who knows, retired after 55 years of work,” she said.
In an emailed statement to CBC News on Thursday, Tim Hortons said the message was meant to show what each customer won over the course of the contest — and the boat was included by mistake.
“We developed a Roll Up To Win recap email message with the best intentions of giving our guests a fun overview of their 2024 play history.
“Unfortunately there was a human error that resulted in some guests receiving some incorrect information in their recap message.”
The company didn’t disclose how many people across the country received the email, but CBC News spoke to another person in western Newfoundland who got it.
Others in Edmonton, Hamilton and Brampton, Ont., were also told they’d won the boat.
By Wednesday afternoon, a Facebook group had formed with more than 200 people expressing outrage about the mistake and threatening to file lawsuits.
Tim Hortons sent the affected customers a letter, telling them to disregard that winning email and that it was sent as a result of “technical errors.”
“Unfortunately, some prizes that you did not win may have been included in the recap email you received. If this was the case, today’s email does not mean that you won those prizes,” the letter read.
“We apologize for the frustration this has caused and for not living up to our high standards.”
It’s a familiar story for Tim’s, however, as last year, its app mistakenly informed users they’d won $10,000.
Evans said two years of big mistakes just isn’t fair. She’d like to see Tim Hortons move away from the Roll Up to Win smartphone app and back to paper cups.
“It’s not fair to the public who spend their hard-earned money to go into Tim’s and buy their coffee every day, buy their lunch, and then think they won a prize and all of a sudden you learn, three hours later, you didn’t win a prize, and it’s not fair.”
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The new regulations will take effect in Bowen Island, Tofino, Pemberton and 14 other communities on Nov. 1
Published Apr 18, 2024 • Last updated 2 hours ago • 5 minute read
With less than two weeks before B.C.’s short-term rental restrictions take effect, visitors staying at an Airbnb, Vrbo or other short-term rental homes are told to check with their hosts to make sure they are not staying in illegal accommodations.
Guests should ask hosts if they are compliant with the new rules, said B.C.’s housing minister, even as he reassured guests they won’t be on the hook.
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“The responsibility to comply with the rules fall with the hosts and the short-term rental platforms,” said Ravi Kahlon at a news conference with Premier David Eby in Langley on Thursday. “We encourage people to continue to explore beautiful British Columbia, and stay in legal short-term rental accommodations.”The new regulations set to take effect on May 1 would restrict short-term rentals to principal residences and either a secondary suite or a laneway home/garden suite on the property.
They apply to more than 60 B.C. communities with populations of more than 10,000 people, as well as 17 smaller communities, including Bowen Island, Tofino, Osoyoos, Pemberton, and Gabriola Island, which have decided to opt in. For these communities, the rules will take effect on Nov. 1.
The new legislation carries penalties of $500 to $5,000 a day per infraction for hosts and reach as high as $10,000 a day for platforms.
Eby said the province’s principal residence requirement is meant to crack down on speculators while allowing homeowners to rent out spaces in their principal residences if they choose to do so.
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He acknowledged the restrictions could put some property owners’ investment and retirement plans into disarray, but made no apologies, saying people with money to invest should put their money elsewhere.
“Do not compete with individuals and families who are looking for place to live with your investment dollars,” Eby said, adding the government will “tilt the deck every single time toward that family.”
The government has set up a provincial enforcement unit, currently staffed by four people, to conduct investigations into alleged non-compliant units.
The enforcement will be largely done digitally and includes the use of a short-term rental data portal that’ll help local governments monitor and enforce regulations.
Municipalities with their own short-term rental restrictions can upload non-compliant properties to the portal, said Kahlon. Platforms will have five days to verify whether the units are on their sites. Local governments without short-term rental licensing can report properties they believe are not compliant.
The platforms will be required to remove non-compliant listings at the request of local or the provincial governments and provide the province with a monthly update of short-term listings on their sites, said Kahlon.
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Companies such as Expedia and Booking.com are working to get ready for the new rules, and he’s hopeful other platforms will follow suit by May 1.
Airbnb said it has been in discussions with the provincial government for months and plans to comply with the new rules, but predicts they will harm the province’s tourism sector by taking extra income away from residents and limiting accommodation options for people, while doing little to improve the housing crunch for residents.
“They’re doing this because they say there’s going to be an impact on housing, that this will free up more housing for people,” said Nathan Rotman, Airbnb’s policy lead in Canada. “That is just not true.”
Despite several years of Airbnb restrictions in Vancouver, for example, rents have gone up while vacancies stayed low, he said.
Kahlon said the pending rules are already having a positive impact on housing availability with short-term rentals being converted to long-term use or being put up for sale.
In March, more than 19,000 entire homes in B.C. were listed as short-term rentals for most of the year, said the province. Even if half of those units are returned to the long-term market, that’ll make a “substantial difference” in communities, said Kahlon.
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Eby said there has been a “massive upswing” in hotel construction in key tourist areas as an unintended result of the new policies.
Bowen Island, a small community of 4,200 whose council voted in March to opt into the province’s short-term rental regulations, has seen increased pressure from tourists and housing demand in recent years.
The decision was council’s way “to balance what is appropriate use in residentially-zoned neighbourhoods while still allowing property owners to still do what they want with their properties,” said Mayor Andrew Leonard.
The principal residence requirement still allows for Airbnb and other short-term rentals on the island, he pointed out. “The vast majority of short-term rental operations are unaffected. This just keeps it in the homes of homeowners instead of speculators.”
Some communities, including Parksville’s Resort Drive area, were granted an exemption last month under the province’s exemption for strata hotel or motels. The area was purpose-built as tourism accommodation more than two decades ago.
The new legislation is being challenged in B.C. Supreme Court by Victoria-based groups and the Westcoast Association for Property Rights, who are calling for a review of the new rules and compensation for financial losses.
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According to Airbnb, Airbnb bookings and related spending generated around $2.5 billion in B.C. in 2023 and created 25,000 jobs.
The company says that for every $100 spent on an Airbnb booking, guests also spent about $229 on other travel spending.
More than three quarters of hosts polled by the company say they use their Airbnb earnings to cover rising costs of living, especially housing.
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