Noah Zivitz

Managing Editor, BNN Bloomberg

Archive

BMO closed out earnings season for the Big Six this morning with a miss as profit in its capital markets business was halved. But it wasn’t all dour, as the bank’s core Canadian unit saw profit surge, and profitability (as measured by the net interest margin) spiked in the U.S. personal and commercial unit. We’ll see how the market weighs the capital markets downturn — which was by no means unique to BMO.

MARKET WATCH

The post-Powell plunge has abated this morning as U.S. futures and major European indices climb. Wonder what Minneapolis Fed President Neel Kashkari is thinking, after stating yesterday he was “happy” to see how the Fed chair’s speech last Friday was received by the market. Notably for the S&P/TSX Composite Index today, West Texas Intermediate crude has been down as much as 3.15 per cent this morning. There’s no obvious single catalyst, though our Bloomberg News partners are highlighting an Iraqi oil official’s commentary about that country’s intent to meet export demand regardless of regional violence.
 
MUSK'S LATEST DEAL-BREAK FODDER

Lawyers for Elon Musk sent a letter to Twitter’s chief legal officer, pointing to the recent whistleblower report as yet another reason why the billionaire should be allowed to walk away from his takeover of Twitter. The letter states that the whistleblower “lays out widespread, egregious violations of the data privacy protections that a company like Twitter is expected—and, indeed, legally required—to have in place. This would be a gross violation of trust by the Twitter platform that will have legal and commercial consequences, and which also gives rise to a Company Material Adverse Effect under the terms of the Merger Agreement.” Twitter’s lawyers responded by saying the latest attempt to terminate the takeover “is invalid and wrongful.”

OTHER NOTABLE STORIES

• Not sure if this will be seen as a competitive threat to Shopify, but Walmart is attempting to woo Canadian entrepreneurs to its U.S. Marketplace.
• Gran Tierra Energy announced it’s planning to repurchase up to 10 per cent of its common shares, explaining – in standard boilerplate language – that it doesn’t think they’re adequately reflecting the company’s value.
• Civeo also announced a buyback. The company, which is best known in these parts for its lodging services in the oil sands, said it’s planning to repurchase up to five per cent of its common shares.
• Best Buy managed to beat second-quarter profit expectations despite a sharp drop in sales, and it’s warning the slide in same-store sales could steepen in the current quarter. In the press release, Best Buy’s chief executive acknowledged last year’s demand was “fuelled partly by stimulus dollars.”
• In the small-cap space: curious batch of news from BuildDirect.Com Technologies — this morning it announced its chief financial officer is resigning tomorrow, its interim chief executive is stepping down next month (with a permanent replacement lined up), and one of its directors is leaving the company’s board immediately. The Vancouver-based operator of an online market for home improvement goods is also raising $3 million in a private placement of 6.5 million shares.
• Alimentation Couche-Tard has mollified the Competition Bureau with respect to the purchase of Wilsons (which was announced a little more than a year ago). Under the terms of the agreement with the competition watchdog, Couche-Tard said it will sell 46 Wilsons sites and supply agreements, and will also divest one of its own gas stations.

NOTABLE RELEASES/EVENTS

• Notable data: Canadian current account balance, U.S. Conference Board consumer confidence index
• Notable earnings: Bank of Montreal, Alimentation Couche-Tard, Best Buy, HP
• 1200: Prime minister Justin Trudeau makes announcement in Kitchener, Ont., on housing alongside housing minister Ahmed Hussen
• 1600: Prime minister Justin Trudeau meets with Ontario premier Doug Ford at Queen’s Park in Toronto