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Equities
Major indexes on both sides of the border fell at Tuesday’s open as recession concerns continue to weigh on global sentiment.
Shortly after the opening bell, the Toronto Stock Exchange’s S&P/TSX composite index was down 239.36 points, or 1.26 per cent, at 18,789.5.
In the U.S., the Dow Jones Industrial Average fell 194.14 points, or 0.62 per cent, at the open to 30,903.12.
The S&P 500 opened lower by 32.72 points, or 0.86 per cent, at 3,792.61, while the Nasdaq Composite dropped 163.66 points, or 1.47 per cent, to 10,964.18 at the opening bell.
“Volatility remains elevated across every asset class to be sure, although a U.S. holiday [on Monday] meant a 12-hour break from the noise,” OANDA senior analyst Jeffrey Halley said.
“What is clear is that the strategy of watching the rooster fight from the sidelines instead of getting involved remains the sensible one,” he said. “The financial markets continue to tie themselves in knots so complicated, that they would give even the saltiest mariner a headache, as they try to price in a recession no recession and its impact on asset prices.”
In the U.S. traders are now looking ahead to the release of the minutes from the latest Federal Reserve on Wednesday and fresh jobs numbers on Friday. Canadian investors also get employment figures Friday morning.
The Globe’s Mark Rendell reports that Canadian consumers and businesses expect inflation to remain high for several years, adding pressure on the Bank of Canada to announce another oversized interest rate increase next week to prevent rapid consumer price growth from becoming entrenched. The central bank released its business outlook and consumer expectations surveys on Monday.
Those surveys come ahead of next week’s Bank of Canada policy announcements. Markets are expecting the central bank to hike rates by three-quarters of a percentage point after the Fed made a similar move in its last policy announcement.
On Tuesday, Canadian investors will got May building permit figures from Statistics Canada. The agency said the total value of building permits rose 2.3 per cent. Permits in the non-residential sector jumped 7 per cent while residential permits slid 0.1 per cent.
Later in the morning, the latest home sale figures from the Real Estate Board of Greater Vancouver will be released. Toronto home sales numbers follow on Wednesday.
Overseas, the pan-European STOXX 600 was off 1.83 per cent by afternoon. Britain’s FTSE 100 fell 2.40 per cent. Germany’s DAX and France’s CAC 40 lost 2.49 per cent and 2.41 per cent, respectively.
In Asia, Japan’s Nikkei gained 1.03 per cent. Hong Kong’s Hang Seng edged up 0.10 per cent.
Commodities
Crude prices struggled in early going as recession concerns continue to weigh on sentiment.
The day range on Brent is US$112.82 to US$114.75. The range on West Texas Intermediate is US$107.25 to US$111.45.
“Although oil is trading supported on the day due to improved risk sentiment and the possible easing of U.S. trade tariffs against China, oil is still struggling to break out from its current recessionary malaise as the market pivots away from inflation to economic despair,” Stephen Innes, managing director with SPI Asset Management, said.
Meanwhile, Norwegian offshore workers began a strike Tuesday that will reduce oil and gas output.
Reuters reports that Norwegian producer Equinor has said the strike is expected to reduce oil and gas output by 89,000 barrels of oil equivalent per day (boepd), of which gas output makes up 27,500 boepd.
In other commodities, gold prices slipped, hit by an elevated U.S. dollar.
Spot gold was down 0.2 per cent at US$1,805.20 per ounce early Tuesday morning, while U.S. gold futures gained 0.4 per cent to US$1,807.80.
Currencies
The Canadian dollar was lower alongside weaker risk sentiment in the broader markets while its U.S. counterpart touched a fresh two-decade high against a group of world currencies.
The day range on the loonie is 77.37 US cents to 77.97 US cents.
“The hawkish BoC remains an important tailwind for the CAD alongside an economy that appears more resilient than that of other major advanced countries,” Shaun Osborne, chief FX strategist with Scotiabank, said.
“However, markets may trade cautiously in the days ahead as they look to the release of the Fed’s minutes tomorrow and US ISM, ADP and NFP data later in the week.”
There were no major Canadian economic reports due Tuesday.
On world markets, the U.S. dollar index, which weighs the greenback against a basket of global peers, gained 0.8 per cent to 105.98, a new two-decade high for the currency, according to figures from Reuters.
The euro, meanwhile, fell to a two-decade low against the U.S. dollar amid continued recession concerns.
The euro’s 0.8-per-cent fall on the day took the currency to its weakest since late 2002.
The Australian dollar, meanwhile, was also weaker despite that country’s central bank’s decision to raise rates for the third time in as many months.
The Australian dollar slid 0.09-per-cent lower to US$0.6820, after trading as high as US$0.6895 earlier in the day.
In bonds, the yield on the U.S. 10-year note was down slightly at 2.882 per cent in the predawn period.
More company news
A two-week strike at Canadian National Railway Co. is ending after the union representing 750 signals and communications workers agreed to binding arbitration. Steve Martin, a spokesman for the International Brotherhood of Electrical Workers, said the strike that was launched June 18 will end just after midnight. Employees will return to their roles Wednesday morning, the company said in a news release.
French music streaming platform Deezerfailed to attract much investor interest for its Paris market debut seven years after its first flotation was aborted, with its shares dropping sharply in early dealing on Tuesday. Deezer, whose larger rivals include Spotify, was down 27.15% at 0947 GMT at 6.00 euros per share, after opening at 8.50 euros.
British Airways is cancelling more flights scheduled for the summer holiday season, it said on Tuesday, at a time of widespread disruption at airports caused by staff shortages and a surge in travel demand. The airline said it would now reduce its April-October schedule by 11%, having said in May the cuts would amount to 10%.
CALGARY – TC Energy Corp. has lowered the estimated cost of its Southeast Gateway pipeline project in Mexico.
It says it now expects the project to cost between US$3.9 billion and US$4.1 billion compared with its original estimate of US$4.5 billion.
The change came as the company reported a third-quarter profit attributable to common shareholders of C$1.46 billion or $1.40 per share compared with a loss of C$197 million or 19 cents per share in the same quarter last year.
Revenue for the quarter ended Sept. 30 totalled C$4.08 billion, up from C$3.94 billion in the third quarter of 2023.
TC Energy says its comparable earnings for its latest quarter amounted to C$1.03 per share compared with C$1.00 per share a year earlier.
The average analyst estimate had been for a profit of 95 cents per share, according to LSEG Data & Analytics.
This report by The Canadian Press was first published Nov. 7, 2024.
BCE Inc. reported a loss in its latest quarter as it recorded $2.11 billion in asset impairment charges, mainly related to Bell Media’s TV and radio properties.
The company says its net loss attributable to common shareholders amounted to $1.24 billion or $1.36 per share for the quarter ended Sept. 30 compared with a profit of $640 million or 70 cents per share a year earlier.
On an adjusted basis, BCE says it earned 75 cents per share in its latest quarter compared with an adjusted profit of 81 cents per share in the same quarter last year.
“Bell’s results for the third quarter demonstrate that we are disciplined in our pursuit of profitable growth in an intensely competitive environment,” BCE chief executive Mirko Bibic said in a statement.
“Our focus this quarter, and throughout 2024, has been to attract higher-margin subscribers and reduce costs to help offset short-term revenue impacts from sustained competitive pricing pressures, slow economic growth and a media advertising market that is in transition.”
Operating revenue for the quarter totalled $5.97 billion, down from $6.08 billion in its third quarter of 2023.
BCE also said it now expects its revenue for 2024 to fall about 1.5 per cent compared with earlier guidance for an increase of zero to four per cent.
The company says the change comes as it faces lower-than-anticipated wireless product revenue and sustained pressure on wireless prices.
BCE added 33,111 net postpaid mobile phone subscribers, down 76.8 per cent from the same period last year, which was the company’s second-best performance on the metric since 2010.
It says the drop was driven by higher customer churn — a measure of subscribers who cancelled their service — amid greater competitive activity and promotional offer intensity. BCE’s monthly churn rate for the category was 1.28 per cent, up from 1.1 per cent during its previous third quarter.
The company also saw 11.6 per cent fewer gross subscriber activations “due to more targeted promotional offers and mobile device discounting compared to last year.”
Bell’s wireless mobile phone average revenue per user was $58.26, down 3.4 per cent from $60.28 in the third quarter of the prior year.
This report by The Canadian Press was first published Nov. 7, 2024.
TORONTO – Canada Goose Holdings Inc. trimmed its financial guidance as it reported its second-quarter revenue fell compared with a year ago.
The luxury clothing company says revenue for the quarter ended Sept. 29 totalled $267.8 million, down from $281.1 million in the same quarter last year.
Net income attributable to shareholders amounted to $5.4 million or six cents per diluted share, up from $3.9 million or four cents per diluted share a year earlier.
On an adjusted basis, Canada Goose says it earned five cents per diluted share in its latest quarter compared with an adjusted profit of 16 cents per diluted share a year earlier.
In its outlook, Canada Goose says it now expects total revenue for its full financial year to show a low-single-digit percentage decrease to low-single-digit percentage increase compared with earlier guidance for a low-single-digit increase.
It also says it now expects its adjusted net income per diluted share to show a mid-single-digit percentage increase compared with earlier guidance for a percentage increase in the mid-teens.
This report by The Canadian Press was first published Nov. 7, 2024.
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