October 16-31, 2025

2025-10-23

[BNN Bloomberg, Terry Cain - Canada]:Carney targets non-U.S. exports by 2035: Prime Minister Mark Carney has set a goal to double Canada’s exports to markets outside the U.S. within a decade to net an extra 300 billion dollars in trade. In a rare televised speech on Wednesday evening, Carney reiterated that U.S. tariffs are causing job losses in major Canadian industries and businesses are holding back investments due to uncertainty. The prime minister touted a free trade agreement with Indonesia as well as agreements with other countries, adding that the upcoming budget will be about “generational investments”. Ottawa is also re-engaging with India and China to deepen its partnerships. The budget is set to be unveiled on Nov. 4.

Oil spikes as Trump ramps up Russia sanctions: The price of oil soared after U.S. President Donald Trump announced sanctions on Russia’s biggest oil companies, threatening disruptions to Russian crude production and exports. The move sparks concern that key buyer India will walk away from dealings with Moscow, and comes at a time when nations inside and outside OPEC+ ramp up output amid signs of cooling demand growth. If India does drastically cut purchases, refinery executives say the restrictions would make it all but impossible for flows to continue.

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2025-10-22

[BNN Bloomberg, Terry Cain - Canada]: Gold plunge drives down TSX: The price of gold is under pressure again today, after a dramatic plunge Tuesday. Bullion fell by more than six per cent Tuesday, its biggest drop in more than 12 years. The fall pushed the TSX composite index down by nearly two per cent, as heavily weighted miners such as Kinross, Barrick and Agnico Eagle plunged by more than nine per cent apiece. The selloff was considered overdue by many market observers – even with yesterdays plunge, gold is still up about 55 per cent this year. Gold has been boosted by fundamental factors such as the so-called debasement trade, in which investors avoid sovereign debt and currencies to protect themselves from runaway budget deficits. However, many investors have been jumping into the sector primarily as a momentum play.

Teck Q3 profit rises: Profit rose by nearly 20 per cent in the latest quarter at Teck Resources, topping analyst estimates. This comes despite the disruptions at its copper mine in Chile, which has reduced output in the third quarter compared to last year. The company left guidance for this mine unchanged since it was reduced earlier this month. Teck accepted a takeover offer from Anglo American earlier this year, though that deal has yet to receive shareholder or regulatory approval.

[Investopedia, USA]: The last time job growth was as slow as it is now, Boom Boom Pow by the Black Eyed Peas was at the top of the charts, a Bitcoin cost a quarter of a cent, and Donald Trump was best known as the host of a game show.

Vanguard data found the U.S. job growth rate was just 0.1% in seven of the first nine months of 2025—an ominous sign, as the last time job growth was that slow for a sustained period was during the Great Recession in 2009. That's less than a third of the recent job growth peak of 0.36% in 2022.

What This Means For The Economy

Vanguard's data highlights the job market's uneasy balance: job creation is slow, but there haven't been any waves of mass layoffs. Officials at the Federal Reserve view the job market as increasingly fragile and are expected to cut interest rates to support job growth and prevent a severe increase in unemployment.

Vanguard's data is one of a handful of reports on the job market created by private companies, which are still being published in the absence of official figures from the government that are being delayed by the ongoing shutdown.

Vanguard's data reinforces recent findings indicating a "low hire, low fire" job market in an uneasy equilibrium. Many employers remain reluctant to either expand or reduce their workforces as they contend with the economic policies of the White House, particularly tariffs and a crackdown on immigration, according to recent surveys.

The slow rate of job creation is bad news for anyone currently looking for work, but the labor market isn't yet in crisis. Unlike the early 2000s, people who currently have jobs can count on relatively stable employment, according to Vanguard.

"Hiring has slowed, but low layoff rates and solid income growth point to a labor market that remains strong for those currently employed," the company said in a blog post.

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2025-10-21

[BNN Bloomberg, Terry Cain - Canada]: Inflation hits seven-month high: Inflation in Canada rose more than expected in September, to a seven-month high of 2.4 per cent. On a monthly basis, the consumer price index rose by 0.1 per cent. The acceleration was driven by higher gasoline prices, as well as the cost of vacations, vehicles, and fruits and vegetables. As economist Charles St. Arnaud said live on BNN Bloomberg just after the numbers were released, the pickup in inflation makes it slightly less likely that the Bank of Canada will cut interest rates at its meeting next week.

Canada nears trade deal with U.S.: The Globe and Mail is reporting a trade deal on steel, aluminum and energy could be ready for Prime Minister Mark Carney and U.S. President Donald Trump to sign at the Asia-Pacific Economic Cooperation summit later this month. A deal would offer long-sought relief for the Canadian metals industry, which has been hit hard by U.S. tariffs. The report says the Americans are not ready to make any deal on automobiles or softwood lumber, two of Canada’s most important exports to the United States. These talks are separate from more formal and wide-ranging renegotiations that will take place in the new year on the CUSMA free-trade deal.

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2025-10-20

[BNN Bloomberg, Keith Richards - Canada]: Top Picks:  iShares MSCI Japan ETF, Alcoa, Cash

I have been in the investment business since 1990 and was investing before that non-professionally for a few years. Let’s call it 40 plus years of trading markets.

In those 40 years, I witnessed, and learned from, numerous pullbacks. Plus, two major bubbles that lead into major 50 per cent plus meltdowns (2001 and 2008).

I believe we are in a bubble right now.

Factors such as the price-to-earnings ratio, options activity seen via the VIX and put call ratio, and others suggest entry into the danger zone for North American markets.

Further, the SPX is back to the top of a very long termed (100+ years) trend channel. That trendline will likely prove to be a point of eventual downward regression for the market.

Finally, for what its worth, this market has all the characteristics of a ‘Wave 5′ employee withholding tax market phase. A Wave 5 classic pattern is characterized by narrow breadth (AI), complacency (VIX, put-call) and very tight swings within a rapidly rising (parabolic) trend.

Having said all of this, the indicators I follow, while suggesting market complacency, are not yet deep enough to suggest that now is the time for the bubble popping. We also have a dovish Fed.

I wrote a blog last week illustrating the absolute relationship between Fed easing and market trends. We are in an easing cycle, suggesting more upside – until the music (easing) stops!

My two cents: We’re in a bubble. But it isn’t over until the fat lady sings.

[BNN Bloomberg, Terry Cain - Canada]: Feds to announce fraud measures: The Canadian Press is reporting the federal government will announce measures today to counter fraud and strengthen Canadians’ financial security, in the latest in a series of pre-budget announcements. Finance Minister François-Philippe Champagne is to be joined at a news conference by Public Safety Minister Gary Anandasangaree and Stephanie McLean, secretary of state for seniors. Champagne is slated to present the federal budget November 4.

Tech outage resolved: A tech outage hit many parts of the online world this morning – but it has now been resolved. Amazon Web Services says its service has recovered from a widespread disruption this morning. The outage affected a range of its customers including government agencies, AI companies and financial platforms. The company says it fixed the issue with a regional gateway on the East Coast of the United States.

Iamgold buying Northern Superior: Iamgold is buying Northern Superior Resources in a deal valued at $267.4 million dollars. Shareholders of Northern Superior will receive a combination of cash and Iamgold common shares in the agreement. The deal will consolidate the gold miner’s significant land package in Quebec’s Chibougamau district. Iamgold also announced they’ll be acquiring another Quebec miner, Mines D’Or Orbec.

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2025-10-18

[BNN Bloomberg, Ryan Bushell - Canada]: It is highly unusual to see strong equity market performance without corroboration from the underlying economy.

So, what is driving markets higher?

In our view, four key themes explain current strength in North American equities:

1. Currency debasement and fear of acceleration

Investors are seeking refuge from fiat currencies by buying equities and gold, echoing points from our last commentary.

Real estate would normally participate as well, but valuations remain stretched following the interest-rate bottom during the pandemic.

Rising asset prices often reflect not just stronger fundamentals but a weakening denominator—the depreciating of the dollar, yen, or euro.

Concerns about chronic fiscal deficits in the West, driven by entitlements, healthcare, military spending, and poor demographics, limit governments’ ability to fund ongoing obligations through taxation.

2. Bubble dynamics in AI and gold                   

History is full of speculative booms sparked by transformative technologies: railroads, automobiles, the “Nifty Fifty,” Internet 1.0, and now AI. These technologies changed the world but also destroyed large amounts of investor capital. AI is likely no different.

Recent circular financing between chipmakers and their customers recalls the excesses that preceded the 2000 tech crash, detailed in the graphic below:

While we see less evidence of a gold bubble, its rapid rise, outsized role in Canadian market gains, and growing institutional interest, suggest momentum chasing is underway.

3. Coordinated central bank easing          

In 2025, five major central banks—including the Federal Reserve in the U.S. and the Bank of Canada—have cut rates, with more easing expected.

Since the “Greenspan Put” in 1987, investors have treated central bank easing as an “all-clear” to buy equities, especially outside deep recessions. This was reinforced after the 2008–2009 financial crisis and again following the 2020 pandemic.

Falling yields on deposits and short-term instruments including guaranteed investment certificates (GICs) are pushing more capital into equities seeking return, particularly amid fears of currency debasement and inflation.

4. Rising energy demand and electrification

Structural shifts in trade, climate, transportation, and AI are fueling demand for power.

Utilities and energy infrastructure are typically defensive sectors that are sold to purchase riskier assets during a market rally. Their strength, alongside technology and gold, has amplified equity market gains this year.

In summary, the themes above are propelling markets higher in 2025 despite clear signs of economic weakness. Falling rates reinforce the perception that central banks stand ready to intervene, but we question whether monetary policy is losing effectiveness after such heavy reliance in recent decades. Many consumers and businesses (particularly U.S. homeowners with long-term fixed mortgages) have already locked in low rates, muting the stimulative impact of further cuts. Housing stagnation, tariffs, and weakening employment are all likely to weigh on growth ahead.

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2025-10-17

[Investopedia, USA]:  Regional bank stocks tumbled on Thursday after Zions Bancorp said it would write off fraudulent loans made to two borrowers, adding to investors’ fears about lending standards and stress in credit markets.

Zions Bancorp (ZION) on Thursday said it had recently identified “what it believes to be apparent misrepresentations and contractual defaults” by two borrowers. As a result, it plans to write off $50 million of the $60 million outstanding on the affected loans.

Shares of Zions dropped 13% on Thursday, leading regional banks lower. The KBW Regional Banking Index fell 6%.

The recent bankruptcies of two companies in the auto sector—car dealer Tricolor and auto parts maker First Brands—have cast a spotlight on potential credit market risks. Tricolor is alleged to have fraudulently pledged risky subprime loan portfolios to multiple creditors, while First Brands was allegedly borrowing against invoices to mask the true size of its debt.

Regional lender Fifth Third Bancorp (FTB), in a regulatory filing in early September, said it would take a $170 million charge related to the collapse of subprime auto lender Tricolor.

 JPMorganChase (JPM) also wrote off $170 million in Tricolor-related loans in the third quarter.

 And Raistone, which facilitates short-term business loans, has said $2.3 billion has “simply vanished” as a result of First Brands’ failure.      

The dual bankruptcies have some on Wall Street worried that more credit losses are in the offing. “I probably shouldn’t say this, but when you see one cockroach, there are probably more,” said JPMorgan CEO Jamie Dimon on Tuesday following the release of a better-than-expected earnings report from the banking giant.

"I expect it to be a little bit worse than other people expect it to be," Dimon added, noting that private credit underwriting standards "may not be as good as you think."

The Unique Risks of Lending to Non-Bank Financial Institutions

Zions’ filing on Thursday added to mounting concerns about transparency in the banking system, especially around lending to non-depositary financial institutions (NDFIs), sometimes referred to as non-bank financial institutions. NDFIs—a category that includes hedge funds, insurers, and lenders of mortgages and consumer loans—offer financial services but do not take deposits, and thus don’t qualify as a bank and are not regulated as such.

Bank lending to NDFIs has exploded in the last decade. Since the financial crisis of 2008-2009, bank loans to NDFIs have grown at nearly three times the rate of the next-fastest growing loan category, according to the Federal Deposit Insurance Corporation’s 2025 risk review.

NDFI lending poses a unique risk to banks. “It can be particularly difficult for banks to assess the credit decisions and management of loans originated by private credit firms,” according to the FDIC. In addition, “loans originated outside the banking system are not subject to the same safety and soundness standards as bank loans, which could lead to higher-risk lending across the financial system.”

[BNN Bloomberg, Terry Cain - Canada]: Carney rules out counter-tariffs: A Canadian delegation is still in Washington for trade negotiations with U.S. officials. Meanwhile Prime Minister Mark Carney says Ottawa is not prepared to impose counter-tariffs against the United States. At a news conference Thursday to announce new crime measures, the Prime Minister said: “Right now with the Americans we are engaged in deep negotiations, intensive negotiations on several sectors of the Canadian economy - energy, aluminum and the steel sector … There are times to hit back and times to talk and right now is the time to talk.”

U.S. to ease auto parts tariffs: There may be a glimmer of hope for the Canadian auto sector. Bloomberg News is reporting the White House is poised to ease tariffs on the U.S. auto industry. The report says that as soon as today the Commerce Department will announce a five-year extension for an arrangement that allows automakers to reduce what they pay in tariffs on imported car parts. Previously, that provision was scheduled to sunset after two years. The concession follows months of lobbying by carmakers for relief from President Donald Trump’s tariffs. Canada is a major supplier of auto parts to U.S.-based manufacturers.

Carney on Stellantis Brampton’s future: Meanwhile Prime Minister Carney says Stellantis will decide on the future of its plant in Brampton, Ont. after the next North American free trade agreement is completed next year. This comes after the company said its moving manufacturing of the Jeep Compass SUV south of the border to avoid tariffs. Carney says he spoke with the CEO of Stellantis and was told that the company is looking to build a different model at the Brampton plant after new CUSMA deal is reached.

High China tariffs “not sustainable”: Markets were given a boost this morning by new comments from U.S. President Trump on China. In an interview on U.S. television, Trump said high threatened tariffs with China were “not sustainable.” The tariff clash between Washington and Beijing saw U.S. import taxes on Chinese goods rise to as high as 145 per cent in a tit-for-tat exchange that raised fears of a global downturn and a cutoff in trade between the two economies.

Scotiabank cutting jobs: The Bank of Nova Scotia says its cutting jobs across its Canadian banking division. In a memo to staff, Aris Bogdaneris, Scotia’s head of Canadian banking, said changes at the bank “over the last few weeks” are designed “to prioritize only those activities that drive the most meaningful impact for our business.” “I want to acknowledge that a transformation of this scale is not easy, especially when it means saying goodbye to valued colleagues,” Bogdaneris said in the memo, but didn’t specify how many roles are being cut.

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2025-10-16

[Investopedia, USA]:  The U.S. economy is still stuck in its low hiring, low firing rut, according to the Federal Reserve's anecdotal Beige Book report.

While there was no hard data attached to Wednesday's report, which covered September and early October, the Beige Book painted a picture of employers across the country avoiding mass layoffs and also steering clear of hiring many new workers.

The report is always based on anecdotes from business and community leaders.

[BNN Bloomberg, Terry Cain - Canada]: Ottawa threatens legal action against Stellantis: The federal government is threatening legal action against Stellantis, after the automaker announced it’s halting plans to manufacture its Jeep Compass SUV at a factory in Brampton, Ont. and will instead move production of the vehicle to the U.S. The move puts the jobs of thousands of workers at the Canadian plant in limbo. Industry Minister Melanie Joly calls the move “unacceptable”, citing legally binding commitments to its Canadian operations, specifically, commitments made by accepting support through Canada’s strategic innovation fund. Ottawa is demanding that Stellantis come up with new mandates for the factory and keep its contracts with Canadian suppliers.

China’s export controls pushback: China’s decision to unveil new export controls on rare earths is sparking a global pushback, with the U.S. and other countries forming a response. The White House said it is speaking with Canada, Australia, India, the Asian democracies and its European allies to form a response to China’s moves. Beijing has said the new export controls are due to national security concerns. The move comes as Chinese president Xi Jinping and U.S. President Donald Trump prepare for their first sit-down in six years next week.

Relief for softwood lumber: Industry Minister Melanie Joly says financial relief is coming soon for Canada’s tariff-hit softwood lumber sector. Joly says Ottawa will provide funding through banks, backstopped by the Business Development Bank of Canada, in the coming days. Joly says the funding will go toward ensuring businesses stay afloat while dealing with “unjustifiable” tariffs, adding that funding will be provided based on individual companies’ needs. The government will also offer support for operations and capital expenditures.

Home sales fall in September: Home sales across the country fell in September after months of growth. Data from the Canadian Real Estate Association shows sales activity declined 1.7 per cent compared to the month before. The drop was led by lower sales in Vancouver, Calgary, Edmonton and Ottawa. New listings also saw a decline in September and home prices fell to their lowest level in over four years. CREA says the data point to a real-estate market that is adjusting to tepid economic conditions and a weak labour market, triggered by a major shift in U.S. trade policy.

BMO to sell U.S. branches: Bank of Montreal has agreed to sell 138 branches in 11 states to First-Citizens Bank & Trust. The lender says the move is part of a plan to optimize its network and is aimed at focusing on markets with potential for long-term growth. BMO says it also plans to open 150 branches over the next five years. Under the terms, First Citizens will assume about US$5.7 billion. In deposits, BMO said it will record a charge of about $104 million in its fourth quarter.