Today’s top headlines
Market close: TSX notches small gain led by energy stocks, U.S. markets fall
Strength in energy stocks helped Canada’s main stock index eke out a small gain today, while U.S. markets moved lower, led by weakness on the Nasdaq.
The S&P/TSX composite index closed up 57.20 points at 19,587.41.
In New York, the Dow Jones industrial average was down 220.33 points at 33,891.94. The S&P 500 index was down 35.43 points at 4,347.35, while the Nasdaq composite was down 128.97 points at 13,521.45.
The Canadian dollar traded for 72.56 cents U.S. compared with 72.48 cents U.S. on Wednesday.
The December crude contract was up 41 cents at US$75.74 per barrel and the December natural gas contract was down seven cents at US$3.04 per mmBTU.
The December gold contract was up US$12.00 at US$1,969.80 an ounce and the December copper contract was up less than a penny at US$3.64 a pound.
The Canadian Press
Stocks fall, yields climb after Powell’s remarks on interest rates
Treasuries tumbled and stocks pushed lower after United States Federal Reserve chair Jerome Powell threw cold water on Wall Street’s dovish bid by saying officials aren’t fully convinced they have tightened interest rates enough.
“If it becomes appropriate to tighten policy further, we will not hesitate to do so,” Powell said in brief opening remarks at an International Monetary Fund conference in Washington, D.C. “We will continue to move carefully, however, allowing us to address both the risk of being misled by a few good months of data, and the risk of overtightening.”
Powell said policymakers are committed to returning inflation to their two per cent target, but “are not confident that we have achieved such a stance.”
Wall Street has also been closely watching the latest U.S. bond sales — a test of the market’s ability to accept the higher issuance.
Shortly after Thursday’s weak auction results, 30-year yields spiked as much as 22 basis points and the S&P 500 extended losses in another sign of how those sales have been exerting a growing sway over markets. The move also pushed the Treasury curve into “bear steepening,” with longer yields outpacing shorter ones.
Ottawa to spend $900 million to build housing in Quebec, matched by province
Prime Minister Justin Trudeau is announcing a $900-million federal contribution over the next four years to accelerate housing construction in Quebec.
He made the announcement today near Montreal alongside Premier Francois Legault, who said the province has agreed to match the federal funds.
The two politicians say the investment will directly create 8,000 social and affordable housing units, including 500 that will be earmarked for people who are homeless or at risk of homelessness.
They say that in the longer term, the combined $1.8-billion commitment will contribute to helping to build tens of thousands of additional homes, at a time when Canada is grappling with a housing crisis that has seen many people struggling to afford a place to live.
Legault says the federal contribution comes without conditions and will help the province build more affordable homes more quickly.
Quebec Housing Minister France-Elaine Duranceau says the province will also work on regulatory reforms to reduce construction delays, including increasing urban densification and reducing red tape.
The Canadian Press
Oil and gas emissions cap coming by end of 2023: Guilbeault
Prime Minister Justin Trudeau’s promised cap on emissions from Canada’s oil and gas sector is coming by the end of the year, his environment minister said.
The cap — which is among the most contentious of Trudeau’s climate policies — has continued to slip past deadlines. The government had aimed to release a draft proposal in early 2023, but talks have dragged on as policymakers aim to craft a document that ensures that emissions go down without forcing production cuts on one of Canada’s largest industries.
Environment Minister Steven Guilbeault told a climate conference in Ottawa that the government has had “hundreds” of meetings on the issue. It’s “a very live conversation,” he said. “But by the end of the year, you will have a pretty good idea of how we will go about that.”
The government is trying for an emissions cap “that pushes for as many reductions as we can see in the sector as possible, without shutting in production that’s not linked to global declines in demand,” Energy Minister Jonathan Wilkinson said.
Guilbeault added that the government is taking care to design the program so it can survive legal challenges. Last month, the Supreme Court of Canada ruled that the government’s law on environmental assessments for resource projects had strayed too far into provincial jurisdiction.
Bank of Canada’s Rogers says rates may stay higher for longer
The Bank of Canada’s no. 2 official urged preparation for interest rates staying elevated for longer.
Senior deputy governor Carolyn Rogers said households and businesses in Canada should ready themselves for an era of borrowing costs higher than over the past 15 years, given the run-up in interest rates since the middle of 2021.
“It’s not hard to see a world where interest rates are persistently higher than what people have grown used to,” Rogers said in prepared remarks in Vancouver.
Structural forces that were keeping borrowing costs low look to have peaked and may be reversing, Rogers said, adding that higher government debt and geopolitical risks have the potential to push rates around the world even higher. Read more.
Freeland to table fall economic statement on Nov. 21
Finance Minister Chrystia Freeland is expected to table the federal government’s fall economic statement on Nov. 21.
The mini-budget is set to offer an update on federal finances, as well as new measures that reflect the government’s priorities.
Freeland has promised that the fall economic statement will focus on housing and affordability, two issues dominating federal politics that are top-of-mind for Canadians.
The Liberals have already announced some measures pertaining to housing over the last couple of months, but all eyes will be on any additional steps they take to help ease the housing shortage.
The federal government is also facing fiscal pressures from a slowing economy and scrutiny for excessive government spending, and Freeland has promised to prioritize fiscal responsibility.
The latest fiscal monitor report from the Finance Department said the federal government posted a $4.3-billion deficit between April and August.
The Canadian Press
Midday markets: TSX jumps more than 200 points, Wall Street mixed
Strength in energy stocks helped lead a broad-based rally as Canada’s main stock index rose more than 200 points in early-afternoon trading, while U.S. stock markets were mixed.
The S&P/TSX composite index was up 238.27 points, or 1.2 per cent, at 19,764.93.
In New York, the Dow Jones industrial average was down 12.77 points, or 0.04 per cent, at 34,099.50. The S&P 500 index was up 3.79 points, or 0.09 per cent, at 4,386.57, while the Nasdaq composite was up 29.62 points, or 0.22 per cent, at 13,681.71.
Wall Street traders are waiting for indications of where rate hikes might be headed when United States Federal Reserve chair Jerome Powell speaks at a panel in Washington, D.C. at 2 p.m.
The Canadian dollar traded for 72.57 cents U.S. compared with 72.48 cents U.S. on Wednesday.
The December crude contract was up $1.11 at US$76.44 per barrel and the December natural gas contract was down six cents at US$3.05 per mmBTU.
The December gold contract was up US$8.10 at US$1,965.90 an ounce and the December copper contract was up two cents at US$3.65 a pound.
The Canadian Press, Bloomberg
Air Canada CEO apologizes for accessibility barriers, rolls out new measures
Air Canada chief executive Michael Rousseau is apologizing for the airline’s accessibility shortfalls and rolling out new measures to improve the travel experience for hundreds of thousands of passengers living with a disability.
Rousseau says the carrier is speeding up a three-year accessibility plan after recent reports of passenger mistreatment, including an incident where a man with spastic cerebral palsy was forced to drag himself off of an airplane due to a lack of assistance.
The measures range from establishing a customer accessibility director to consistently boarding passengers who request lift assistance first.
Air Canada also aims to implement annual, recurrent training in accessibility — such as how to use a lift — for its 10,000-odd airport employees and include mobility aids in an app that can track baggage.
David Lepofsky, visiting research professor of disability rights at Western University’s law faculty, says that as a blind person he dreads flying in Canada because of unreliable assistance, despite an overhaul of regulations starting in 2020.
Statistics Canada found that 63 per cent of the 2.2 million people with disabilities who used federally regulated transportation in 2019 and 2020 faced a barrier.
The Canadian Press
Markets open: Wall Street wanes as traders wait for Fed chair’s comments
The advance in U.S. stocks waned as bond yields rose, with traders unwilling to make big commitments as they awaited remarks from chair Jerome Powell and a raft of United States Federal Reserve speakers.
The S&P 500 was little changed down 0.17 per cent at 4,375.40. If the gauge finished higher, it will notch its longest winning run since November 2004. Treasury 10-year yields climbed five basis points to 4.54 per cent. Thursday’s US$24 billion sale of 30-year bonds will be another test of the market’s ability to accept higher issuance. The U.S. dollar was little changed. Bitcoin hit an 18-month high, topping US$37,000.
Equities rebounded this month as bond yields came off historic highs, with traders betting the steepest tightening cycle in a generation is over and that monetary easing will begin from mid-2024.
As Powell gets ready to take centre stage during a panel at 2 p.m. Washington time, Wall Street will be focused on any clues about how the recent moves in longer-term Treasuries could impact the outlook for policy.
“Markets are listening to central bankers, but they’re also taking on board recent data and are becoming more confident that further hikes are off the table,” said James Rossiter, head of global macro strategy at TD Securities.
The Dow Jones Industrial Average was down 0.25 per cent at 34,026.21 while the Nasdaq composite was down 0.08 per cent at 13,640.73.
In Toronto, the S&P/TSX composite index was up 0.84 per cent at 19,694.89.
Earnings roundup: Cineplex, Quebecor and WSP Global
Cineplex Inc. reported net income of $29.7 million in its latest quarter as Barbie, Oppenheimer and Mission Impossible: Dead Reckoning helped its revenue hit an all-time quarterly record.
The results for the quarter last year included a $49.8-million one-time gain related to the reorganization of its Scene loyalty program.
Revenue for the quarter this year totalled $463.6 million, up from $339.8 million in the same quarter last year.
The increase came as theatre attendance rose to nearly 15.7 million for the quarter compared with nearly 11.1 million a year earlier.
Quebecor Inc. reported its third-quarter profit rose compared with a year ago as the acquisition of Freedom Mobile Inc. earlier this year helped boost revenue.
The company reported $209.3 million in net income attributable to shareholders for the quarter ended Sept. 30, up from $178.4 million a year earlier.
Quebecor says the profit amounted to 91 cents per share, up from 76 cents per share in the same quarter last year.
Revenue for the quarter totalled $1.42 billion, up from $1.14 billion a year earlier.
WSP Global Inc.
WSP Global Inc. is reporting its third-quarter profit and revenue both rose by nearly a quarter compared with a year ago, buoyed by organic growth as well as recent acquisitions.
The engineering company says its net earnings attributable to shareholders grew to $156.2 million or $1.25 per share for the three months ended Sept. 30 compared with $127.5 million or $1.05 per share in the same period a year earlier.
Revenue rose 24 per cent to $3.6 billion in its third quarter from $2.9 billion the year before.
The Canadian Press
Canadian Tire raises dividend, takes $328-million charge on Scotiabank deal
Canadian Tire Corp. Ltd. raised its quarterly dividend as it reported a loss in its latest quarter, weighed down by a one-time charge related to its deal to buy back the 20 per cent stake in Canadian Tire Financial Services that is owned by Bank of Nova Scotia.
The retailer says it will now pay a quarterly dividend of $1.75 per share, an increase of 2.5 cents per share.
The increased payment to shareholders came as Canadian Tire reported a net loss attributable to shareholders of $66.4 million, or $1.19 per diluted share, for the quarter ended Sept. 30 compared with a profit of $184.9 million, or $3.14 per diluted share a year earlier.
The results included a $328-million charge related to the Scotiabank transaction, offset in part by a $131-million insurance recovery related to a fire at a distribution centre in March.
On a normalized basis, Canadian Tire says it earned $2.96 per diluted share in its latest quarter, compared with $3.34 per diluted share a year earlier.
Revenue was $4.25 billion, up from $4.23 billion in the same quarter last year, while consolidated comparable sales fell 1.6 per cent.
The Canadian Press
Read the full story here.
Holiday job postings down from last year amid slowing economy
Canadian postings for seasonal holiday jobs are down 30 per cent from a year ago so far, according to Indeed, amid a softening economy and cooling labour market.
“There’s been an overall cooling of employer hiring appetite over the past year. And it’s pretty similar in seasonal work and other areas of the economy as well, said Indeed senior economist Brendon Bernard.
Overall Canadian job postings are also down 27 per cent from last year, though they’re up 18 per cent from pre-pandemic, Indeed said in a report released Nov. 9.
“Seasonal recruitment started slow in September this year, and while it picked up in October, it wasn’t enough to close the gap,” the hiring site said.
Meanwhile, holiday postings were around the same level as pre-pandemic. As a result, Indeed said holiday postings represent a smaller share of overall postings than they did in 2019.
While the slowing macroeconomic environment is likely to blame for overall lower postings, the slowdown in holiday job openings is likely also related to industry-specific trends like e-commerce and remote work, said Bernard.
The Canadian Press
Read the full story here.
Before the opening bell: Stock futures steady after 8 days of gains
United States stock futures ticked higher after the S&P 500 notched an eight-day streak of gains. Treasuries fell ahead of more speeches by central bank officials.
While the momentum has fizzled out, the S&P 500 has inched higher this week and if the index closes up for another day, it would mark the longest winning run since 2004.
European markets outperformed, with the Stoxx 600 adding 0.6 per cent on the back of a 32 per cent surge in shares of Adyen NV, a Dutch payments processor that competes with PayPal Holdings Inc.
Elsewhere, oil hovered near a three-month low after plunging almost seven per cent over the previous two sessions. The yield on 10-year Treasuries rose three basis points to 4.52 per cent. Bitcoin rallied to an 18-month high.
In Canada, the S&P/TSX composite index closed lower, down 45.38 points to 19,530.21.
What to watch today
Bank of Canada senior deputy governor Carolyn Rogers will provide a financial stability update in Vancouver. Watch her speech live at noon ET here:
The Canadian Climate Institute and the Net-Zero Advisory Body co-host their third annual climate conference entitled “Building Momentum Toward Net Zero” in Ottawa. Natural Resources Minister Jonathan Wilkinson and Environment Minister Steven Guilbeault will speak.
The Canadian Club of Ottawa hosts Marc Parent, chief executive of CAE Inc., for a discussion entitled “Positioning Canada for Global Success.”
The United States will release initial jobless claims for the week of Nov. 4 at 8:30 a.m.
On the earnings front, expect reports from Rogers Communications Inc., Canadian Tire Corp. Ltd., Saputo Inc., Quebecor Inc., News Corp., Sony Corp., AstraZeneca PLC, and Honda Motor Co. Ltd.
Canadians’ view on economy, personal finances darkens
Pay hikes are great, but workers really want something else
Need a refresher on yesterday’s top headlines? Get caught up here.
Additional reporting by The Canadian Press, Associated Press and Bloomberg
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