2025-07-15
[BNN Bloomberg, Terry
Cain - Canada]: Taking it to the bank: U.S. stock futures
pointed upward today, with the S&P 500 set to open in record territory,
after giant banks posted earnings above expectations. JPMorgan’s second-quarter
profit slipped from a year ago but earnings per share of US$4.96 topped
estimates. Tariff headlines caused market gyrations during the quarter and the
firm’s traders blew away expectations. It was a similar story at Citigroup,
which recorded trading volumes. Overall profit rose 25 per cent from a year
earlier.
Rate cut less likely:
Canadian inflation accelerated for the first time in four months and underlying
price pressures firmed, probably keeping the Bank of Canada’s from cutting
interest rates this month. The consumer price index was up 1.9 per cent year-over-year
in June, matching projections. The bank’s two preferred core inflation measures
accelerated slightly, averaging 3.05 per cent, and above estimates.
U.S. inflation slows:
However, underlying U.S. inflation rose in June by less than expected for a fifth
month, as lower car prices helped offset price hikes in other goods exposed to
tariffs. Categories that are more vulnerable to import levies, including toys,
furniture, appliances and apparel, showed increases, suggesting companies are
starting to pass higher import costs on to consumers.
Rare find: The buzz around MP materials, the U.S. rare earth player, keeps getting buzzier. Apple has struck a US$500 million deal to buy the minerals from MP, which just last week secured backing from the Pentagon as the U.S. tries to ensure supplies of critical materials. MP operates what is said to be the sole U.S. rare-earth mine at Mountain Pass in California and it’s developing a magnets factory.
----------------------------------------------------
2025-07-11
[BNN Bloomberg, Terry
Cain - Canada]: A new tariff tirade: The federal government’s softly trade
tactics (notably backing down on a digital services tax) don’t seem to be
paying off. U.S. President Donald Trump is threatening a 35 per cent tariff on
some Canadian goods and raised the prospect of increasing levies on most other
countries. “Fentanyl is hardly the only challenge we have with Canada, which
has many Tariff, Non-Tariff, Policies and Trade Barriers, which cause
unsustainable Trade Deficits against the United States,” Trump said in a letter
to Prime Minister Mark Carney, posted on social media. U.S. stock futures
dropped as the U.S. leader ramped up his trade rhetoric.
Unemployment slightly
down: Despite looming tariffs, Canada added 83,100 jobs last month, beating all
estimates, and the unemployment rate fell 0.1 percentage points to 6.9 per
cent. However, the growth was concentrated in part-time work, which increased
by 70,000 positions. And there were few gains among youth and people aged 55
years and older.
Aritzia's earnings up: Analysts like the look of the latest results from Canadian clothing chain Aritzia. Chris Li at Desjardins says the retailer is “firing on all cylinders” and he’s hiking his price target on the stock to US$91 from $84. Aritzia shares have jumped almost 40 per cent this year to trade at just over $74 Comparable sales soared 19 per cent in the latest quarter, boosted by what Li calls "exceptional growth in Canada"
--------------------------------------------------------
2025-07-10
[BNN Bloomberg Canada] U.S. President Donald Trump announced Thursday that starting Aug. 1, the U.S. will charge a 35 per cent tariff on Canadian products sent into the country.
[BNN Bloomberg, Terry Cain - Canada]: U.S. stocks steady: U.S. stock futures held near all-time highs before markets opened today. Chip seller Nvidia edged higher. On Wednesday, its market capitalization briefly topped US$4 trillion, a record for any company. “The market’s sensitivity toward tariffs has diminished,” one strategist told Bloomberg. “The key driver of equity returns for us has been and remains corporate earnings, particularly in the IT sector, and here policy and trade uncertainty have not caused too much damage.”
Crunch time: Ferrero
International, the secretive Italian family-owned chocolate company, is close
to acquiring cereal producer WK Kellogg for about US$3 billion, Bloomberg says.
A takeover would combine the maker of Nutella with the company behind Froot
Loops and Frosted Flakes cereals. Now I’d have called that sort of stuff junk
but Bloomberg prefers the gentler term “comfort foods.” Shares in Kellogg
jumped 50 per cent in premarket trading. The original Kellogg Co. split in two
in 2023, with the snacking business rebranded Kellanova and the cereal brands
under WK Kellogg.
Seeing red: U.S.
President Donald Trump says Washington will begin levying a 50 per cent tariff
on copper imports from Aug. 1, a move that will increase costs for American
producers of everything from automobiles to appliances. The Financial Times
quotes Ivanhoe Mines founder Robert Friedlandas welcoming the levy, arguing
that U.S. domestic production of the red metal is “fundamental to America’s
national security.” Of course, he would say that when his Ivanhoe Electric is working
on potential mines in Arizona and Utah.
[Investopedia,
USA]:
·
Federal Reserve policymakers are split on
whether to cut interest rates in July, minutes of the Federal Open Market
Committee's June meeting showed.
·
"A couple" members of the
12-vote committee said they were open to a July cut, while most said they
expected to cut rates at some point this year.
·
"Some" members said it was
likely the fed would not change its key interest rate at all in 2025.
--------------------------------------
2025-07-09
[BNN Bloomberg, Terry
Cain - Canada]: Copper futures in flux: Investors in metal producers are trying
to figure out the implications of a threat by U.S. President Donald Trump to
slap a big 50 per cent import tax on copper imports. His warning, in an
apparently off-the-cuff comment to reporters, sparked chaos in metals markets
Tuesday. There was a record spike in New York copper futures. Such a levy would
impose costs across the U.S. economy because the metal is so widely used.
Playing the red
metal: Our copper coverage on Wednesday includes insight from Canaccord Genuity
analyst Dalton Baretto. A tariff would be likely to raise prices in the U.S.
and Baretto says companies with producing U.S. mines today include
Freeport-McMoRan and Rio Tinto. He also says Toronto-listed Taseko Mines is
poised to deliver copper cathode production in the U.S. by year-end from its
Florence project in Arizona.
H&R REIT in the
crosshairs: The Globe and Mail says U.S. private equity funds and the giant
Public Sector Pension Investment Board are in talks to acquire H&R Real
Estate Investment Trust, which has a market cap just north of US$3.5 billion.
Last week, H&R said it has been getting proposals to buy all or part of the
REIT. Activist investor K2 & Associates Investment Management is demanding
that the company disclose the suitors, complaining that “the board has decided
to keep unit holders completely in the dark about potential paths forward.”
[Investopedia,
USA]: Trump's Latest Tariff Turnabout
Deepens Confusion About Trade Policy
·
The latest string of tariff announcements
from President Donald Trump has created more confusion about what the U.S.
trade policy will be in the coming months and years.
·
A major question is whether his new Aug. 1
deadline for the U.S. to impose "reciprocal" tariffs on multiple
trading partners will hold firm.
· One trade expert said that after two extensions, Trump can no longer afford to delay imposing the tariffs any longer without losing credibility.
------------------------------------------------
2025-07-08
[BNN Bloomberg, Terry
Cain - Canada]: Optimism
on tariff compromise: U.S. stock futures held steady this morning on hopes
there’s room for talks after U.S. President Donald Trump’s latest tariff
threats. Trump said he was still open to negotiations and has postponed duties
of 25 per cent or more on a list of trading partners until at least Aug. 1. “Equity
markets are focused on the positive news,” one strategist told Bloomberg.
“Europe is working toward securing a framework agreement with the U.S. and the
July 9 deadline was pushed out by another month.”
Champagne’s chainsaw: Finance Minister François-Philippe
Champagne is asking ministers to slash expenses as Prime Minister Mark Carney
tries to pay for billions of dollars in new spending. They include a
middle-class tax cut and a $9.3 billion boost to meet NATO’s defence spending
target of two per cent of GDP by this fiscal year. Ministers must find ways to
reduce program spending by 7.5 per cent in the fiscal year that begins April 1,
2026, 10 per cent the next year and 15 per cent in 2028-29.
Norway’s crude desires: OPEC+ isn’t alone when it comes to flooding well-stocked oil markets with even more product. Bloomberg says Norway is spending more than US$15 billion to squeeze barrels from its continental shelf during the rest of this decade. The offshore Johan Sverdrup and Johan Castberg fields now pump about 1 million barrels a day combined, complicating efforts by the OPEC+ cartel to balance the market.
---------------------------------------------------------------------
2025-07-07
[BNN Bloomberg, Robert
McWhirter - Canada]: Year to date the U.S. dollar has declined about 10 per
cent, signalling the potential start of a secular U.S. dollar decline.
The non-partisan
Congressional Budget Office projects the recent U.S. “budget bill” adds nearly
US$4 trillion to the estimated $36-trillion federal debt. Bond investors are
particularly concerned by the failure to trim the $1.3-trillion annual federal
deficit. Will this lead to higher U.S 30-year bond yields causing U.S. mortgage
rates to rise?
Foreign investors
appear to be hedging the currency aspect of their U.S. bond and equity
investments causing further downward pressure on the U.S. dollar.
Gold was up 27 per
cent in 2024 and is up 27 per cent year to date. Several central banks continue
to reduce their U.S. dollar holdings and are buying gold.
The record free cash flow being produced by gold companies is attractive to generalist investors. Commodities appear to be starting a new uptrend providing support for the S&P/TSX composite index.
---------------------------------------------
2025-07-04
[BNN Bloomberg, Terry
Cain - Canada]: TSX breaks through 27,000 points: Canada’s benchmark stock
index, the S&P/TSX composite, finished at more than 27,000 for the first
time ever yesterday, closing at 27,034 points. It’s now up more than nine per
cent so far in 2025. The most influential gainers so far this year have been
Shopify, Brookfield Corporation and Royal Bank of Canada.
No U.S. trading
today: Stock market trading will be paused today in the United States for the
July 4 holiday. Stock market trading will proceed as usual here in Canada.
Strategist waves
caution flag on U.S. stocks: A senior Wall Street strategist says the red-hot
rally in U.S. stocks investors have enjoyed since early April is now at the
point where investors should consider selling some of their holdings. Michael
Hartnett of Bank of America said he would consider the S&P 500 index at
6,300 points to be a sell signal. The index closed within a fraction of a
percentage-point of that level Thursday. Hartnett said risks of a U.S.
stock-market bubble are rising. The S&P 500 has gained 26 per cent since
April 8.
Cargojet renews deal
with Amazon: Shares of Cargojet, the Mississauga-based air shipper, rose by
more than four per cent Thursday. The company announced an extension of its
deal to ship packages for Amazon Canada. The new deal runs to the end of March
2029.
Canadian dollar
traded at 73.5 cents U.S. this morning: The loonie is up 6.8 per cent from its
lowest level versus the U.S. dollar over the past year, 68.8 cents U.S. on Jan.
31.
------------------------------------------------------
2025-07-02
[BNN Bloomberg, Terry
Cain - Canada]: Trading on the TSX resumes: Stock market trading will resume in
Canada today, after pausing for the Canada Day holiday yesterday, and the
S&P/TSX Composite Index will begin today’s session at 26,857 points. It is
now up more than 8.5 per cent so far this year. U.S. stocks, meanwhile, did
trade yesterday, and futures contracts on the three main U.S. stock indices
were mainly higher this morning.
First shipment of
Canadian LNG on its way to Asia: The first shipment of Canadian liquified
natural gas (LNG) is now on an ocean-going vessel, on its way from Kitimat,
British Columbia to buyers in Asia. The LNG Canada plant near Kitimat was under
development for about seven years and includes the Haisla First Nation as one
of its joint-venture partners. Shell, the global oil and gas giant, owns 40 per
cent of the facility. Prime Minister Mark Carney said: “Canada has what the
world needs. With LNG Canada’s first shipment to Asia, Canada is exporting its
energy to reliable partners, diversifying trade, and reducing global emissions,
all in partnership with Indigenous peoples.”
Bombardier announces
US$1.7B aircraft sale: Bombardier said late Monday that it has agreed to sell
50 of its aircraft to a new, unnamed, buyer. The sales will be worth US$1.7
billion. Bombardier makes business jets under the Challenger and Global
banners, and the sales in this deal are expected to begin in 2027. Shares of
Bombardier have surged higher by 45 per cent since early May and closed on
Monday at $118.64 per share. That’s the highest share price since early October
of 2018.
Monitoring the loonie: The Canadian dollar traded at 73.3 cents U.S. this morning. The loonie is now up 6.6 per cent versus the U.S. dollar since Jan. 31, when it traded at just 68.8 cents U.S. Currency experts say weakness in the U.S. dollar is the main driver of Canadian dollar strength versus the Greenback. The U.S. dollar, they say, has weakened because of concern over the economic consequences of U.S. trade policies, a deteriorating fiscal outlook and expectations that the U.S. Federal Reserve Board will soon cut interest rates.
Crude oil prices
rise: The price of West Texas Intermediate crude oil was up 1.25 per cent this
morning to US$66.26 per barrel. There is lots of key oil market news coming in
the days ahead: new U.S. supply data today, a U.S. jobs report tomorrow and an
OPEC+ meeting on the weekend.
Price of gold rises:
The price of gold traded in the New York futures market rose this morning to
US$3,353 and change. Gold markets have their eyes on U.S. President Donald
Trump’s multi-trillion-dollar tax bill, which has now been passed by the U.S.
Senate and is on its way to the U.S. House of Representatives. If passed, the
legislation would widen the U.S. fiscal deficit to $3.3 trillion over the next
decade and traders say that could boost gold’s appeal as a safe haven asset.
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