Catalysts that could drive the Big 6 bank stocks post-pandemic
Boeing has another major problem on its hands. This time, it’s the 777 jet that’s under the microscope after a weekend engine failure on a United Airlines flight prompted the plane maker to recommend the grounding of 128 aircraft powered by the same Pratt & Whitney engine that broke apart over Denver on Saturday. From a public relations standpoint, this could hardly come at a worse time both for the company – which is recovering from the 737 Max crisis – and the industry, which is navigating the most tumultuous period in its history due to the pandemic. From an investing standpoint, investors are demonstrating their frustration, with Boeing shares down more than 3 per cent in pre-market trading.
BANK EARNINGS AHEAD
Bay Street’s Super Bowl gets going tomorrow as Canada’s Big Six banks enter earnings season. While the year-over-year comparisons will be tough, given that last year’s fiscal first quarter feel immediately prior to the pandemic, analysts and investors are already looking ahead and assessing the potential for eventual dividend increases, share buybacks and a winnowing-down of loan-loss provisions. Paul Bagnell has set the scene with a primer at BNNBloomberg.ca. Today we’re looking forward to speaking with analysts John Aiken and Nigel D’Souza.
U.S. futures and major European indices are entering the week under pressure, as the perceived threat of inflation continues driving the 10-year U.S. Treasury yield higher. Copper is also making a notable climb toward US$9,000 per ton in London, and Bitcoin is easing back after hitting a record of US$58,350.41. We’ll get plenty of opportunities this week to find out if central bankers are sweating price pressure, with U.S. Federal Reserve Chair Jerome Powell beginning two days of congressional testimony tomorrow; Bank of Canada Governor Tiff Macklem has remarks scheduled for tomorrow as well.
As of today, air travelers arriving in Canada face a new set of rules, including a mandatory three-night stay (at their own expense) in one of 18 government-approved hotels in Montreal, Toronto, Vancouver and Calgary. Meanwhile, as the Trudeau government draws scorn for the slow rollout of vaccines, Procurement Minister Anita Anand touted on Twitter last night that 643,000 doses are on the way this week.
OTHER NOTABLE STORIES
- Just Energy shares came under renewed pressure in early trading today after the company warned that, absent “corrective active” by the state government, it could face a $315-million hit as a result of fallout from the deep freeze in Texas.
- Kohl’s will be a stock to watch after The Wall Street Journal reported a group of activists controlling nearly 10 per cent of the company’s shares are pushing for a board-level overhaul at the department chain operator.
- There’s some consolidation in America’s crowded regional bank sector today, with Buffalo-headquartered M&T agreeing to buy People’s United Financial for US$7.6 billion.
- Former Bank of Canada and Bank of England Governor Mark Carney is adding another role to his resume, with the weekend announcement that he’s joining the board of online payments technology firm Stripe.
- Notable earnings: GFL Environmental, Equitable Group, Gibson Energy, Transocean
- 12:05 p.m. ET: U.S. President Joe Biden delivers remarks relating to small businesses
- 2 p.m. ET: Ontario Premier Doug Ford makes announcement alongside Solicitor General Sylvia Jones and Associate-Minister of Children and Women’s Issues Jill Dunlop