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U.S. stock markets move sharply higher on COVID-19 optimism – CBC.ca

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U.S. stocks bounced back from their worst week in nearly two months Monday as optimism about a potential vaccine for the coronavirus and hopes for an economic recovery in the second half of the year put investors in a buying mood.

The S&P 500 was up 3.5 per cent, on track for its best day since early April. The gains erased all of its losses from last week, when the index posted its worst showing since late March and its third weekly loss in the last four.

Toronto’s stock exchange was closed for the Victoria Day holiday. 

But it wasn’t just U.S. stocks moving higher. Bond yields rose broadly in another sign of positive sentiment among investors.

Stocks were already headed for a higher opening on Wall Street when a drug company announced encouraging results in very early testing of an experimental coronavirus remedy. The stock of the company, Massachusetts-based Moderna, jumped 21.1 per cent.

Investors were also encouraged by remarks over the weekend from Federal Reserve Chair Jerome Powell, who expressed optimism that the U.S. economy could begin to recover in the second half of the year. Once the outbreak has been contained, he said, the economy should be able to rebound “substantially.”

The Dow Jones Industrial Average gained 963 points, or 4.1 per cent to 24,649. The Nasdaq composite climbed 2.7 per cent. Small-company stocks fared better than the rest of the market. The Russell 2000 index rose 5.8 per cent.

Investors are hoping that a working vaccine for COVID-19 can be developed, because it could provide the reassurance people and businesses need to ensure the reopening of the economy succeeds.

“The question of how quickly people come back, or will they come back to the way they used to do things, that’s much different if you have a vaccine,” said Megan Horneman, director of portfolio strategy at Verdence Capital Advisors.

Cautious optimism

Traders are also encouraged that, so far at least, there hasn’t been a lot of data implying the reopening of the economy is going to lead to a resurgence in the number of COVID-19 cases, said Sam Stovall, chief investment strategist at CFRA.

“Of course, because we are responding to impressions, we could end up giving back some of these gains should additional information contest our beliefs,” he said.

Technology and financial stocks accounted for a big slice of the broad gains, along with health care and industrial companies. Energy stocks rose as the price of U.S. crude oil headed sharply higher, crossing above $30 a barrel for the first time in two months as oil production cuts kick in at the same time that demand is rising as the U.S. and other countries ease some of the restrictions aimed at stemming the spread of the outbreak.

Benchmark U.S. crude oil for June delivery jumped 8.1 per cent to settle at $31.82 a barrel. July Brent crude oil, the international standard, vaulted 7.1 per cent to $34.81 a barrel.

Bonds yields rose, another sign that pessimism was diminishing. The yield on the 10-year Treasury note, a benchmark for interest rates on many consumer loans, rose to 0.73 per cent from 0.64 per cent late Friday.

Fears of a crushing recession due to the coronavirus sent the S&P 500 into a skid of more than 30 per cent from its high in February. Hopes for a relatively quick rebound and unprecedented moves by the Federal Reserve and Congress to stem the economic pain fueled a historic rebound for stocks in April.

Massachusetts-based Moderna Therapeutics revealed encouraging signs in a trial of a possible coronavirus cure on Monday, causing the stock to soar by 21 per cent. (Brian Snyder/Reuters)

May got off to a downbeat start as investors balance cautious optimism of a recovery as economies around the world slowly open up again against worries that the moves could lead to another surge in coronavirus infections and more economic uncertainty. But Monday’s strong start to the week reversed all of the market’s losses so far this month.

“We had a near 30 per cent advance from the March 23 low to April 17, and then basically treaded water for a month as investors were expecting some sort of a retest of the prior low, which obviously did not come,” Stovall said. “Usually, markets need to catch their breath after a sprint higher.”

Wall Street is hoping that the reopening of businesses and the relaxation of stay-at-home mandates continue without any major setbacks, paving the way for corporate profits to bounce back.

Europe has been taking steps to reopen its economy more widely, and so far, new infections and deaths have slowed considerably across the continent. Some countries there started easing lockdowns a month ago and even the harshest shutdowns — such as those in Italy and Spain — have loosened significantly.

In his interview with CBS’s “60 Minutes,” Powell said the U.S. economy was fundamentally healthy before the virus forced widespread business shutdowns and tens of millions of layoffs. He noted that a full recovery won’t likely be possible before the arrival of a vaccine.

Before trading opened, Moderna said its experimental vaccine showed encouraging results in early testing, triggering hoped-for immune responses in eight healthy, middle-aged volunteers. The vaccine generated antibodies similar to those seen in people who have recovered from COVID-19 in study volunteers who were given either a low or medium dose.

Worldwide, about a dozen vaccine candidates are in the first stages of testing or nearing it. Health officials have said that if all goes well, studies of a potential vaccine might wrap up by very late this year or early next year.

Markets in Europe also notched strong gains Monday. The FTSE 100 in London rose 4.3 per cent and the DAX in Frankfurt climbed 5.7 per cent. France’s CAC 40 rose 5.2 per cent. Markets in Asia finished broadly higher.

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Telus selects Nokia, Ericsson as 5G suppliers – Yahoo Canada Finance

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Toronto, Canada - June 16, 2019: TELUS Scarborough office building in Toronto, canada. Telus is a Canadian telecommunications company that provides telecommunications products and services.

Vancouver-based national carrier Telus has selected Nokia and Ericsson as its 5G vendors, a press release from the company said. 

The news comes the same day that Bell announced it too would use Ericsson to provide radio access network (RAN) equipment. 

“Our team is committed to rolling out superior network technology from urban to rural communities, fueling our economy and driving innovation as we power Canadians into the 5G era through an unparalleled network experience,” Telus’ CEO Darren Entwistle said in the release. 

“Our 5G deployment will support economic growth and diversity that will be essential for the virtualization of health, education, teleworking, and stimulating the economic growth and recovery given the impact of COVID-19.”

During its Q1 2020 earnings, CFO Doug French said its focus right now is to help its customers during the COVID-19 crisis.

In its Q4 2019 earnings, the carrier said it was not going to pre-announce its 5G launch plans but that its initial module, or the first phase of the 5G rollout, would be with Huawei until the government approves its RFP.

Bell and Telus use Huawei’s network equipment in some areas. The federal government is still reviewing whether or not it intends to ban the Chinese telecommunications manufacturer from participating in Canada’s 5G rollout.

Rogers also uses Ericsson as a 5G vendor.

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North American equity markets rally in spite of widespread unrest – BNNBloomberg.ca

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1:15 p.m. ET: North American equity markets extend gains into midday, oil rallies

North American equity markets were solidly in positive territory through the midday trade, with the S&P/TSX Composite Index up 0.9 per cent, the Dow Jones Industrial Average gaining 0.8 per cent, the S&P 500 rising 0.4 per cent and the Nasdaq Composite modestly higher, up 0.1 per cent.

U.S. benchmark oil West Texas Intermediate accelerated higher into the afternoon, rising more than three per cent to US$36.55 per barrel to trade at session highs.

That helped lift the TSX energy sector, which led the way on the composite with a 3.4-per-cent gain on the session.

The Canadian dollar continued to move higher against its U.S. counterpart, gaining a third of a cent to trade at 74.04 cents U.S., though the greenback has been broadly weaker against almost all of its major-market peers.

9:35 a.m. ET: North American equity markets rally in spite of widespread unrest

North American markets notched gains into the early trading day Tuesday, with the S&P/TSX Composite Index and Dow Jones Industrial Average both up half a per cent, the S&P 500 gaining a third of a per cent and the Nasdaq Composite Index up a more modest 0.1 per cent. The gains came in spite of widespread civil unrest in the United States, as some police responded with force to demonstrators protesting against systemic racial inequities.

In Toronto, shares of BlackBerry Ltd. rose about seven per cent to extend Monday’s gains after an unconfirmed report from StreetInsider said the company has held talks with Fairfax Financial over a deal for Fairfax to acquire the remainder of BlackBerry’s shares. In an email to BNN Bloomberg, BlackBerry declined to comment on rumours or speculation.

BlackBerry shares rise on takeover report

BlackBerry is a stock to watch after a report Monday suggesting Fairfax Financial was considering a takeover of BlackBerry sent the shares higher. BNN Bloomberg’s Paul Bagnell has more.

Crude oil prices were higher, with U.S. benchmark West Texas Intermediate up half a per cent to US$35.0 per barrel, though it had briefly breached the US$36 level earlier in the day. Crude has gotten a boost from the OPEC+ group’s production curtailments, and there are reports the group may extend those cuts for another month to support prices.

Alberta’s Western Canadian Select also gained, rising 1.55 per cent to US$29.51 per barrel.

The Canadian dollar extended Monday’s surge against its U.S. counterpart, gaining another two-tenths of a cent to 73.90 cents U.S.

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All Addition Elle and Thyme Maternity stores in Canada to close down – CBC.ca

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Reitmans will shutter 77 Addition Elle and 54 Thyme Maternity stores across Canada as part of its restucturing process, the Montreal-based retailer announced Tuesday.

Last month, the 94-year-old fashion chain announced that it would restructure its operations partly because of COVID-19, which hammered retailers hard.

In addition to its eponymous chain focusing on work clothes for career-aged women, Reitmans also runs the Addition Elle, Thyme Maternity, RW & Co. and Penningtons chains.

As past of the restructuring process, Reitmans has decided to permanently close Addition Elle and Thyme Maternity. The former focuses on plus size fashions. The latter on maternity wear.

The move will result in the loss of about 1,400 jobs — 1,100 in store and about 300 at head office.

Reitmans has been around sine 1926 but the COVID-19 pandemic hurt the retail business hard. (Evan Mitsui/CBC)

“The strategic decision to close two beloved Canadian fashion brands was not made lightly, but it is necessary to enable our business to move forward as a profitable organization,”  CEO Stephen Reitman said.

“All of the efforts we put forth to turn these brands around were derailed by the COVID-19 pandemic and, unfortunately, we can no longer afford the required resources to bring them back to profitability.”

Locations of both chains are set to reopen in the coming days, subject to physical distancing restrictions across the country, but the two retail chains will be in wind-down mode, liquidating as much inventory as possible to pay back creditors.

The last day for Thyme Maternity will be July 18.

The last day for Addition Elle will come the next month, on August 15.

Company wide, before the restructuring process began Reitmans had 576 stores across Canada, including 259 Reitmans, 106 Penningtons and 80 RW & CO. locations. Many stores for the surviving three brand names will also close, as the company plans to put more focus into selling online.

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