U.S. stocks tumbled Friday as the Federal Reserve’s most closely watched inflation measure came in stronger than expected, in another sign that price pressures have become sticky into 2023.
The S&P 500 (^GSPC) sank 1.3%, while the Dow Jones Industrial Average (^DJI) plopped nearly 400 points, or 1.2%. The technology-heavy Nasdaq Composite (^IXIC) tanked 1.6%.
U.S. Treasury yields scrambled higher following the reading. The 2-year note surged 10 basis points to 4.8% while the 10-year note gained 7 basis points to 4.86%.
The Personal Consumption Expenditures (PCE) price index — the Fed’s preferred assessment of how quickly prices are rising across the economy — rose 0.6% in January and 5.4% from last year. On a “core” basis, which strips out volatile food and energy components, prices rose 0.6% for the month and 4.7% from last year.
The report from the Commerce Department also showed that consumer spending rose 1.8% last month from December after falling the previous month.
The numbers support recent indications inflation is not falling at the pace and extent investors have been hoping for, even as prices have stabilized from the peaks of the current inflation cycle.
“First December CPI was revised higher, and now each reading for January surprised to the upside. Inflation’s like an old boyfriend or girlfriend that keeps showing up when you don’t want to see them,” David Russell, Vice President of Market Intelligence at TradeStation said in a note.
Beyond Meat’s (BYND) stock rallied nearly 15% after better-than-expected earnings and CEO Ethan Brown said the company is seeing progress in its efforts to cut costs and manufacturing hurdles.
Beleaguered used car retailer (CVNA) was in a downswing, plunging 12% after reporting a net loss that was nine times wider in the fourth quarter.
A trader works on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., February 17, 2023. REUTERS/Brendan McDermid
The bumpier-than-anticipated road to restoring price stability and strong economic data to start the year — nonfarm payrolls rose by 517,000 in January while retail sales surged 3% — have prompted investors to readjust expectations around the path forward for interest rates, putting a dent in the market’s recent momentum.
The S&P 500 snapped a four-day losing streak on Thursday as stocks closed higher. But earlier this week on Tuesday, stocks had their worst day of the year.
“Equity bulls and even Chair Powell have bragged about anchored expectations for inflation and how consumers and investors believe it is moving in the right direction,” Morgan Stanley Chief Investment Officer Lisa Shalett said in a note earlier this week, noting that January’s Consumer Price Index (CPI) and Producer Price Index (PPI) raised questions about whether inflation progress is stalling.
“Given data crosscurrents, the central bank needs to tread carefully. Investors still wagering on a ‘Fed put; or quick return to financial repression are apt to be wrong this time,” Shalett said. “Fed credibility is on the line, and it is likely to risk overshooting rather than quitting the inflation fight too early.”
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Alexandra Semenova is a reporter for Yahoo Finance. Follow her on Twitter @alexandraandnyc
TORONTO – Canada Goose Holdings Inc. says it has signed a deal that will result in the creation of its first eyewear collection.
The deal announced on Thursday by the Toronto-based luxury apparel company comes in the form of an exclusive, long-term global licensing agreement with Marchon Eyewear Inc.
The terms and value of the agreement were not disclosed, but Marchon produces eyewear for brands including Lacoste, Nike, Calvin Klein, Ferragamo, Longchamp and Zeiss.
Marchon plans to roll out both sunglasses and optical wear under the Canada Goose name next spring, starting in North America.
Canada Goose says the eyewear will be sold through optical retailers, department stores, Canada Goose shops and its website.
Canada Goose CEO Dani Reiss told The Canadian Press in August that he envisioned his company eventually expanding into eyewear and luggage.
This report by The Canadian Press was first published Sept. 19, 2024.
Almost seven years since news broke of an alleged conspiracy to fix the price of packaged bread across Canada, the saga isn’t over: the Competition Bureau continues to investigate the companies that may have been involved, and two class-action lawsuits continue to work their way through the courts.
Here’s a timeline of key events in the bread price-fixing case.
Oct. 31, 2017: The Competition Bureau says it’s investigating allegations of bread price-fixing and that it was granted search warrants in the case. Several grocers confirm they are co-operating in the probe.
Dec. 19, 2017: Loblaw and George Weston say they participated in an “industry-wide price-fixing arrangement” to raise the price of packaged bread. The companies say they have been co-operating in the Competition Bureau’s investigation since March 2015, when they self-reported to the bureau upon discovering anti-competitive behaviour, and are receiving immunity from prosecution. They announce they are offering $25 gift cards to customers amid the ongoing investigation into alleged bread price-fixing.
Jan. 31, 2018: In court documents, the Competition Bureau says at least $1.50 was added to the price of a loaf of bread between about 2001 and 2016.
Dec. 20, 2019: A class-action lawsuit in a Quebec court against multiple grocers and food companies is certified against a number of companies allegedly involved in bread price-fixing, including Loblaw, George Weston, Metro, Sobeys, Walmart Canada, Canada Bread and Giant Tiger (which have all denied involvement, except for Loblaw and George Weston, which later settled with the plaintiffs).
Dec. 31, 2021: A class-action lawsuit in an Ontario court covering all Canadian residents except those in Quebec who bought packaged bread from a company named in the suit is certified against roughly the same group of companies.
June 21, 2023: Bakery giant Canada Bread Co. is fined $50 million after pleading guilty to four counts of price-fixing under the Competition Act as part of the Competition Bureau’s ongoing investigation.
Oct. 25 2023: Canada Bread files a statement of defence in the Ontario class action denying participating in the alleged conspiracy and saying any anti-competitive behaviour it participated in was at the direction and to the benefit of its then-majority owner Maple Leaf Foods, which is not a defendant in the case (neither is its current owner Grupo Bimbo). Maple Leaf calls Canada Bread’s accusations “baseless.”
Dec. 20, 2023: Metro files new documents in the Ontario class action accusing Loblaw and its parent company George Weston of conspiring to implicate it in the alleged scheme, denying involvement. Sobeys has made a similar claim. The two companies deny the allegations.
July 25, 2024: Loblaw and George Weston say they agreed to pay a combined $500 million to settle both the Ontario and Quebec class-action lawsuits. Loblaw’s share of the settlement includes a $96-million credit for the gift cards it gave out years earlier.
Sept. 12, 2024: Canada Bread files new documents in Ontario court as part of the class action, claiming Maple Leaf used it as a “shield” to avoid liability in the alleged scheme. Maple Leaf was a majority shareholder of Canada Bread until 2014, and the company claims it’s liable for any price-fixing activity. Maple Leaf refutes the claims.
This report by The Canadian Press was first published Sept. 19, 2024.
Companies in this story: (TSX:L, TSX:MFI, TSX:MRU, TSX:EMP.A, TSX:WN)
TORONTO – TD Bank Group, which is mired in a money laundering scandal in the U.S., says chief executive Bharat Masrani will retire next year.
Masrani, who will retire officially on April 10, 2025, says the bank’s, “anti-money laundering challenges,” took place on his watch and he takes full responsibility.
The bank named Raymond Chun, TD’s group head, Canadian personal banking, as his successor.
As part of a transition plan, Chun will become chief operating officer on Nov. 1 before taking over the top job when Masrani steps down at the bank’s annual meeting next year.
TD also announced that Riaz Ahmed, group head, wholesale banking and president and CEO of TD Securities, will retire at the end of January 2025.
TD has taken billions in charges related to ongoing U.S. investigations into the failure of its anti-money laundering program.
This report by The Canadian Press was first published Sept. 19, 2024.
