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* Weekly jobless claims unexpectedly rise to 870,000
* Nikola slides after Wedbush downgrade
* Accenture drops, BlackBerry rises on quarterly earnings
* Indexes up: Dow 0.39%, S&P 0.54%, Nasdaq 0.81% (Updates to early afternoon)
Sept 24 (Reuters) – Wall Street climbed in choppy trading on Thursday, with investors returning to the perceived safety of technology-related stocks as a surprise rise in weekly jobless claims signaled a slowdown in economic growth.
Nine of the 11 major S&P indexes were trading higher, with information technology leading gains.
Apple Inc, Amazon.com Inc, Netflix Inc , Nvidia Corp and Facebook Inc, which have outperformed at a time of increased economic uncertainty, rose between 0.5% and 2.7%.
“Investors are going to be needing stocks that can weather a lower growth path because if we don’t get another round of fiscal stimulus, there’s not going to be a lot more we can do to continue boosting the economic recovery,” said Max Gokhman, capital markets strategist at Pacific Life Fund Advisors.
Waning hopes of more fiscal stimulus, signs of a faltering business recovery and a sell-off in technology-related names have weighed on U.S. stocks this month.
The S&P 500 briefly fell 10% below its intraday record high hit on Sept. 2. If the benchmark index closes at that level, it will enter correction territory.
Dow constituents, considered a barometer of economic confidence, lagged the S&P 500 on Thursday as data showed 870,000 Americans applied for jobless benefits in the week ended Sept. 19, up from 866,000 in the previous week.
Job cuts have spread to industries such as financial services and technology that were not initially impacted by the mandated business closures in mid-March because of insufficient demand.
At 12:32 p.m. ET, the Dow Jones Industrial Average was up 0.39%, the S&P 500 was up 0.54% and the Nasdaq Composite was up 0.81%.
The CBOE volatility index, which is hovering near two-week highs, is expected to climb in the run up to the quarter end next week.
“The key is the VIX index, which has not yet reached levels that would suggest a continued strong move to the downside,” said Peter Cardillo, chief market economist at Spartan Capital Securities in New York.
“So you might get a day of bargain hunting followed by a day of selling, but as the last days of September come into place, we should begin to see some sort of window dressing by institutions.”
Homebuilders climbed 0.8% as sales of new single-family homes increased to their highest level in nearly 14 years last month.
Nikola Corp, which is set for its biggest weekly decline ever, shed another 4.3% as Wedbush downgraded the stock to “underperform”.
Accenture Plc fell 6.4% after the IT consulting firm forecast current-quarter revenue below expectations, while, U.S.-listed shares of Canadian security software firm BlackBerry Ltd jumped 5% after it posted a surprise rise in quarterly revenue.
Declining issues nearly matched advancers on the NYSE and the Nasdaq.
The S&P index recorded no new 52-week highs and two new lows, while the Nasdaq recorded seven new highs and 116 new lows. (Reporting by Sagarika Jaisinghani and Devik Jain in Bengaluru; Editing by Arun Koyyur)
HALIFAX – Ottawa is negotiating a $500-million bailout for Nova Scotia’s privately owned electric utility, saying the money will be used to prevent a big spike in electricity rates.
Federal Natural Resources Minister Jonathan Wilkinson made the announcement today in Halifax, saying Nova Scotia Power Inc. needs the money to cover higher costs resulting from the delayed delivery of electricity from the Muskrat Falls hydroelectric plant in Labrador.
Wilkinson says that without the money, the subsidiary of Emera Inc. would have had to increase rates by 19 per cent over “the short term.”
Nova Scotia Power CEO Peter Gregg says the deal, once approved by the province’s energy regulator, will keep rate increases limited “to be around the rate of inflation,” as costs are spread over a number of years.
The utility helped pay for construction of an underwater transmission link between Newfoundland and Nova Scotia, but the Muskrat Falls project has not been consistent in delivering electricity over the past five years.
Those delays forced Nova Scotia Power to spend more on generating its own electricity.
This report by The Canadian Press was first published Sept. 16, 2024.
TORONTO – Roots Corp. may have built its brand on all things comfy and cosy, but its CEO says activewear is now “really becoming a core part” of the brand.
The category, which at Roots spans leggings, tracksuits, sports bras and bike shorts, has seen such sustained double-digit growth that Meghan Roach plans to make it a key part of the business’ future.
“It’s an area … you will see us continue to expand upon,” she told analysts on a Friday call.
The Toronto-based retailer’s push into activewear has taken shape over many years and included several turns as the official designer and supplier of Team Canada’s Olympic uniform.
But consumers have had plenty of choice when it comes to workout gear and other apparel suited to their sporting needs. On top of the slew of athletic brands like Nike and Adidas, shoppers have also gravitated toward Lululemon Athletica Inc., Alo and Vuori, ramping up competition in the activewear category.
Roach feels Roots’ toehold in the category stems from the fit, feel and following its merchandise has cultivated.
“Our product really resonates with (shoppers) because you can wear it through multiple different use cases and occasions,” she said.
“We’ve been seeing customers come back again and again for some of these core products in our activewear collection.”
Her remarks came the same day as Roots revealed it lost $5.2 million in its latest quarter compared with a loss of $5.3 million in the same quarter last year.
The company said the second-quarter loss amounted to 13 cents per diluted share for the quarter ended Aug. 3, the same as a year earlier.
In presenting the results, Roach reminded analysts that the first half of the year is usually “seasonally small,” representing just 30 per cent of the company’s annual sales.
Sales for the second quarter totalled $47.7 million, down from $49.4 million in the same quarter last year.
The move lower came as direct-to-consumer sales amounted to $36.4 million, down from $37.1 million a year earlier, as comparable sales edged down 0.2 per cent.
The numbers reflect the fact that Roots continued to grapple with inventory challenges in the company’s Cooper fleece line that first cropped up in its previous quarter.
Roots recently began to use artificial intelligence to assist with daily inventory replenishments and said more tools helping with allocation will go live in the next quarter.
Beyond that time period, the company intends to keep exploring AI and renovate more of its stores.
It will also re-evaluate its design ranks.
Roots announced Friday that chief product officer Karuna Scheinfeld has stepped down.
Rather than fill the role, the company plans to hire senior level design talent with international experience in the outdoor and activewear sectors who will take on tasks previously done by the chief product officer.
This report by The Canadian Press was first published Sept. 13, 2024.
VANCOUVER – Mediated talks between the union representing HandyDART workers in Metro Vancouver and its employer, Transdev, are set to resume today as a strike that has stopped most services drags into a second week.
No timeline has been set for the length of the negotiations, but Joe McCann, president of the Amalgamated Transit Union Local 1724, says they are willing to stay there as long as it takes, even if talks drag on all night.
About 600 employees of the door-to-door transit service for people unable to navigate the conventional transit system have been on strike since last Tuesday, pausing service for all but essential medical trips.
Hundreds of drivers rallied outside TransLink’s head office earlier this week, calling for the transportation provider to intervene in the dispute with Transdev, which was contracted to oversee HandyDART service.
Transdev said earlier this week that it will provide a reply to the union’s latest proposal on Thursday.
A statement from the company said it “strongly believes” that their employees deserve fair wages, and that a fair contract “must balance the needs of their employees, clients and taxpayers.”
This report by The Canadian Press was first published Sept. 12, 2024.
