The Big Three: Uncertainty in CannTrust; Canopy Growth shares tumble; wild week for markets
CannTrust is warning of a potential “material” hit depending on the outcome of Health Canada’s review of the company’s unlicensed production scandal. In a kitchen sink-style update late Thursday, the beleaguered cannabis producer also said it’s been unable to hold “substantive” remediation discussions with the federal regulator. The update paints the picture of a company that’s in the dark about its regulatory fate, which raises important questions about what it can hope to achieve in the strategic review that’s underway. Nevertheless, the stock is rallying in New York. Also worth noting CannTrust saw fit to include a liquidity update in its release: $250 million in cash and equivalents as of June 30. Of course, its scandal came to light on July 8.
STOCKS RALLY INTO WEEKEND
European markets are up across the board and futures are indicating it will be a strong start on Wall Street at 9:30 a.m. ET. But as we saw yesterday, sentiment could swing in an instant. Heading into today’s session the S&P/TSX Composite Index is down 2.01 per cent so far this week.
BANK EARNINGS AHEAD
Royal Bank of Canada will set the bar for its peers when it reports fiscal third-quarter results next Wednesday. We’ll set the table this morning on The Open with Robert Sedran from CIBC Capital Markets. Also watch out for a preview piece on BNNBloomberg.ca later today.
OTHER NOTABLE STORIES
-Shares of Deere & Co. are slipping in pre-market trading after the farm equipment maker reported a drop in fiscal third-quarter revenue and trimmed its full-year profit outlook while citing “the high degree of uncertainty that continues to overshadow the agricultural sector.”
-Ex-Freshii CFO Craig De Pratto is trading salads for mattresses, with an announcement late yesterday he’s joining Sleep Country Canada as chief financial officer.
-Cathay Pacific’s CEO has quit after his airline attracted China’s scorn for staff involvement in recent protests.
-Our Bloomberg partners are reporting Alibaba vice-chair Joe Tsai has a deal to buy the NBA’s Brooklyn Nets and their home arena for US$3.5 billion.
-Worth watching shares of Newton Glassman’s Callidus Capital after it announced Braslyn will buy the lender’s minority-held shares for $0.75 each.
-Notable earnings: Deere & Co.
-Notable data: Canadian international securities transactions, U.S. housing starts and building permits
Every morning BNN Bloomberg's Managing Editor Noah Zivitz writes a ‘chase note’ to BNN Bloomberg's editorial staff listing the stories and events that will be in the spotlight that day. Have it delivered to your inbox before the trading day begins by heading to www.bnnbloomberg.ca/subscribe.