Here are five things you need to know this morning
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.
Impatient for stimulus: Profit declined in the third quarter at Mullen Group, down about $5 million from the same time last year. The Alberta-based trucking company’s revenue rose over the quarter. However, Mullen Group’s chair and senior executive officer, Murray Mullen says its top line growth is being driven by acquisitions. Mr. Mullen also had some provocative comments in the company’s earnings release, calling the results “especially satisfying given the current state of the Canadian economy, which continues to struggle with a number of trade and tariff related issues, along with a lack of private capital investment. The ‘nation building projects’ announced by the Federal Government would boost economic activity and create new jobs for many Canadians. The issue is, from our perspective, when will these economic drivers and job creators begin? It is precisely for this reason that we continue to rely upon acquisitions to grow our business today.”
Brazil weighs on Netflix: Shares of Netflix traded lower in the pre-market. The video streaming company’s third quarter profit was weighed down by a tax dispute in Brazil. The company reported operating income just over US$3 billion, missing its own forecast and analysts’ estimates by about US$400 million. This comes amid reports that Netflix and Comcast are weighing bids for parts of Warner Brothers Discovery.
Beyond Meat sizzles: Beyond Meat shares doubled in premarket trading, boosting its four-day rally to almost 1,300 per cent, in an apparent return of the meme-stock frenzies that periodically roil the market. Shares in the struggling maker of plant-based burgers began rallying last Friday, and the advance picked up steam Monday on reports of a prominent trader touting the stock on social media. The momentum may have been powered by bearish traders covering their bets against Beyond Meat: about 64 per cent per cent of the shares available for trading had been sold short as of the end of September. The rally took another leg higher yesterday when the company announced an increased availability of its products at Walmart stores.
