Now what? That’s the big question after the U.S. Surface Transportation Board rejected Canadian National Railway’s application for a voting trust to move forward with its proposed takeover of Kansas City Southern. Late last night, CN issued a brief statement saying it is “evaluating the options” that are available to the railway and gave no immediate indication that it’s throwing in the towel. Canadian Pacific, meanwhile, reminded Kansas City Southern about its rival bid and said it is “excited to re-engage”. CP management will have more to say in a conference call at 9 a.m. today. No comment yet from KCS; time is ticking ahead of a scheduled shareholder vote on the CN deal Friday.
CAMPAIGN WATCH
The Liberal Party will release its platform today, on the eve of the campaign’s first televised debate, and our Bloomberg News partners are reporting it will include at least $50 billion in spending measures (some of which have already been announced). According to the reporting, the spending will be “fully financed by a tax revenue windfall from an expanding economy.” One can’t help but wonder what the basis was for the Liberals’ projections, and whether yesterday’s surprise GDP contraction for July and the second quarter risks derailing the fiscal plan.
OPEC+ MEETS
What will the cartel and its allies do now that the COVID-19 Delta variant is threatening the global economic recovery and demand outlook? In mid-July, after prolonged negotiations, the group finally decided to extend cooperation until the end of next year and said it planned to expand production by 400,000 barrels per day every month. We’ll see if that plan holds.
MANAGING CANADA’S HOTTEST HOUSING MARKET
It’s not Toronto or Vancouver. The most heat is in Halifax these days, at least according to the latest Teranet/National Bank home price index, which showed July prices surged 33.4 per cent year-over-year in the Atlantic hub city. We’re looking forward to speaking with Mayor Mike Savage this afternoon at 4:30 p.m.
WELCOME BACK, JAMESON
It’s a homecoming at BNN Bloomberg as Jameson Berkow returns to our team today. Watch for his reporting online and on air in the days ahead. And a belated public welcome as well to Temur Durrani, who joined us this week after most recently reporting on the economy for the Winnipeg Free Press. Watch for his storytelling at BNNBloomberg.ca
OTHER NOTABLE STORIES
- A pair of great Bloomberg pieces on pandemic life: Apparently a lot of workers are getting fired or reprimanded for messing up on Zoom calls, and this is some fantastic reporting on the future of business travel.
- Quebec’s vaccine passport for access to non-essential services is now in effect. Meanwhile, it’s a guessing game surrounding how the province’s western neighbour will move forward. CTV News is reporting Ontario Premier Doug Ford met with his cabinet on the issue again last night and it’s “now unclear” how this will play out.
- Alimentation Couche-Tard is facing a choppy recovery from the impacts of COVID-19. Its adjusted profit was flat at $0.71 per share in the fiscal first quarter. Fuel sales surged compared to the prior year, while merchandise sales were all over the place (+64 per in Europe, flat in Canada and the U.S.) In a release, CEO Brian Hannasch said “the pandemic continues to present operational and supply chain challenges to the business.”
- Advantage Energy has raised its capital spending plan for this year to a range of $140-$150 million; it earlier forecast $115-$135 million. The company also said late yesterday it’s expecting record production this year.
- Enbridge announced a management switcheroo today. Vern Yu, who has very much been Enbridge’s face in the dispute over Line 5, is moving into the role of chief financial officer. He’s replacing Colin Gruending, who is moving into the role Yu had occupied as executive vice-president and president of liquids pipelines.
- Laurentian Bank rounded out earnings season with a 71 per cent surge in first quarter net income, and an adjusted profit that beat by a wide margin ($1.25 vs $1.08).
- Some U.S. focused cannabis M&A this morning with Terrascend buying Michigan-focused Gage Growth Corp. in a US$545-million stock deal.
NOTABLE RELEASES/EVENTS
- Notable data: ISM U.S. manufacturing index
- Notable earnings: Laurentian Bank
- 9:30: NDP Leader Jagmeet Singh makes announcement in Montreal (plus avail)
- 10:00: Liberal Party Leader Justin Trudeau makes announcement in Toronto (plus avail)
- 11:00: OPEC+ holds ministerial meeting
- 11:00: Conservative Party Leader Erin O’Toole makes announcement in Ottawa (plus avail)
- 13:00: Ontario Premier Doug Ford makes announcement alongside Health Minister Christine Elliott, Associate Minister of Digital Government Kaleed Rasheed and Chief Medical Officer of Health Dr. Kieran Moore
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