The crude-by-rail business is booming at Canadian National, in another reminder that this country’s struggle to get pipelines built has translated into a major revenue driver for the country’s two largest rail companies. CN's petroleum and chemicals revenue surged 50 per cent in the fourth quarter to $815 million, while total revenue in the period reached $3.8 billion. On a call with analysts, management said it expects "a little dip" in crude-by-rail this quarter because of the forced production cuts in Alberta, before shipments "ramp back up" in Q2. Also notable: the company is planning a record capital spend of $3.9 billion this year, while rewarding shareholders with a richer dividend and a new share buyback program.
APPLE CEO VENTS
Tim Cook’s frustration with the investment community is becoming increasingly palpable. "We manage Apple for the long term," he said in an earnings release yesterday that spared shareholders from another nasty surprise, thus pushing Apple shares ~five per cent higher in the pre-market. On the conference call, Cook again attempted to explain Apple's "bright future" in China after saying his messaging in the Jan. 2 letter "got lost," while taking another shot at short-termism in the market: "We don't measure our success in 90-day increments," he said. But investors do. We'll try to square that up.
TRADE TALKS IN D.C.
Robert Lighthizer today leads a U.S. delegation into two days of trade talks with a Chinese team helmed by Vice Premier Liu. The two sides are aiming to avert an escalation in their tariff war on March 1 when a standstill agreement is scheduled to expire.
FED DAY
With virtually zero probability of a change in the target range for the U.S. central bank's benchmark rate, balance sheet management could be the main topic of interest, particularly after this recent WSJ story: Decision is at 2:00 p.m. ET, with a news conference starting a half hour later.
OTHER NOTABLE STORIES
-Shares of Boeing surged in pre-market trading after the plane maker reported fourth-quarter profit that trounced estimates (US$5.48 vs US$4.59) and unveiled 2019 forecasts that outpaced expectations.
-The Globe and Mail is reporting the Ontario Securities Commission and U.S. Securities and Exchange Commission are scrutinizing so-called short and distort practices, wherein investors who are betting against a stock purposefully spread inaccurate information in an attempt to drive down the company’s stock.
-Empire Co. says it's been given the go-ahead to offer buyouts to Safeway employees in B.C., which CEO Michael Medline calls a "major building block" in ultimately improving the company's performance in Western Canada as it converts some stores to its FreshCo banner. The buyouts could result in a $35-million charge in this year's third quarter.
-AGT Food and Ingredients’ largest shareholder is still resisting the company’s proposed $18/share privatization. Letko, Brosseau & Associates said in a release late yesterday it thinks the offer comes at a vulnerable time for the pulse maker, and it believes brighter days are ahead as industry conditions improve.
-EBay, the recent target of an activist investor, yesterday announced it’s initiating a quarterly dividend at US$0.14/share. The stock is flat in pre-market trading.
-And for when it’s too much trouble to get a cup of coffee, Tim Hortons announced today it’s launching a Double Double Coffee Bar.
NOTABLE RELEASES/EVENTS
-Notable earnings: CGI Group, McDonald's, Boeing, AT&T, Visa, Tesla, Microsoft, Facebook
-Notable data: U.S. GDP
-Calgary Real Estate Board releases 2019 forecast
-11:00 a.m. ET: Democratic Institutions Minister Karina Gould, Public Safety Minister Ralph Goodale, National Defence Minister Harjit Sajjan hold news conference to unveil plan to safeguard Canada's election.
-12:00 p.m. ET: Blackrock Global Head of Active Equities Mark Wiseman (ex-CPPIB CEO) delivers speech in Toronto
-12:00 p.m. ET: Canadian Transportation Agency concludes two-day hearing in Vancouver re. freight rail investigation
-2:00 p.m. ET U.S. Federal Reserve releases interest rate decision (plus news conference at 2:30 p.m. ET)
-Canadian stock exchanges hold lottery for POT ticker symbol
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.
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