Nov 19, 2019
The Daily Chase: CN Rail workers walk off the job; TSX hot streak snapped
By Noah Zivitz
More than 3,000 conductors and railyard workers at CN Rail walked off the job shortly after midnight; in a brief statement, Teamsters Canada said negotiations to resolve the dispute are continuing. BNN Bloomberg's Paige Ellis is gathering reaction from major Canadians industries that rely on CN to haul their goods, and will find out what some top economists have to say about when the strike could dent GDP. We’ll also keep tabs on CN management comments at a Scotia conference this morning.
TSX STREAK SNAPPED
The TSX Composite’s winning streak was brought to a halt yesterday after 11 straight days of gains that propelled the index above 17,000 points. While not the biggest drags, pot producers weighed on Bay Street as Aurora Cannabis, Aphria and Hexo suffered double-digit declines Monday.
CIBC LEAVES BAY ST. 'SCRATCHING THEIR HEADS'
Great piece from Doug Alexander at Bloomberg News today on how Victor Dodig’s CIBC has struggled to deliver a message that resonates with investors. “People are scratching their heads, trying to figure out exactly where things are heading,” is what Analyst John Aiken told Doug. We’ll explore what it’ll take to swing sentiment.
TC ENERGY SEES SLOWER DIVIDEND GROWTH
The pipeline operator said today it expects average dividend growth to slow to a 5-7 per cent annual rate after 2021 from its target of 8-10 per cent annual payout growth up til that point. The company formerly known as TransCanada said it’s “methodically” advancing the Bruce Power extension and Keystone XL and says those projects would bolster the company’s growth outlook if they see the light of day. We’ll monitor developments at TC’s investor day, which could be overshadowed to a certain extent by the recent Keystone spill in North Dakota and renewed political pressure in the U.S. as a pair of top Democrats call for a formal regulatory review of TC in the wake of that incident.
OTHER NOTABLE STORIES
-Shares of Home Depot are falling in pre-market trading after the retailer fell short of third-quarter same-store estimates and trimmed its full-year sales forecasts, with its CEO saying it’s taking longer than anticipated to see the payoff from a five-year strategic investment plan.
-The retail blues extends to department store chain Kohl’s. Its shares are down more than 10 per cent in the pre-market after cutting its profit forecast.
-Canadian Apartment Properties REIT is raising at least $350 million in a bought-deal financing. Units are priced at $53.60 apiece. That’s one dollar below yesterday’s closing level. CAPREIT also disclosed it’s buying six properties for $194 million.
-It’s dispiriting to say data like this is no longer surprising: a new Sun Life survey shows 47 per cent of working Canadians say there’s a serious risk they’ll outlive their savings.
-The Wall Street Journal has an interesting feature about how American Express is dangling significant payments (up to US$450,000) in an attempt to convince U.S. merchants to accept its cards.
NOTABLE RELEASES/EVENTS
-Notable earnings: George Weston, Home Depot, TJX
-Notable data: Canadian manufacturing sales, Teranet/National Bank home price index, U.S. building permits and housing starts
-8:00 a.m. ET: TC Energy holds investor day meeting
-11:30 a.m. ET: U.S. President Donald Trump holds cabinet meeting at The White House
-12:35 p.m. ET: Bank of Canada Senior Deputy Governor Carolyn Wilkins delivers speech in Montreal (remarks on Bank website at 12:20 p.m. ET)
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.
