Finance Minister Chrystia Freeland will present her government’s fiscal update this afternoon, with all signs pointing to this country being on course for an even larger deficit than the $343.2-billion shortfall telegraphed by ex-Finance Minister Bill Morneau in July. Our Bloomberg News partners are reporting Freeland will unveil billions of dollars in new spending to cushion the economic blow from COVID-19 and lay the groundwork for future signature items of the Trudeau Liberals.
We have a full team that will be ready to break the news on air and online around 4 p.m. ET, plus an impressive lineup of guests including the likes of former Parliamentary Budget Officer Kevin Page and PIMCO’s former Canadian quarterback, Ed Devlin. Hard to think of two people better suited to assess the sustainability of the government’s spending plans.
CANADIAN CONSUMER DEBT TOPS $2 TRILLION
That’s according to Equifax, whose quarterly report shows $2.041 trillion in total borrowings as of the end of the third quarter amid demand for mortgages and auto loans. While the delinquency rate is at the lowest since 2014 at 0.98 per cent, there are no doubt worrying signs. To wit: Equifax says 12 per cent of new loans in the quarter were by consumers who were already taking advantage of a deferral program.
BANK EARNINGS EVE
We’ll set the scene today for year-end reporting season for Canada’s Big Six banks, which gets started tomorrow with Bank of Montreal and Bank of Nova Scotia. Industry analysts John Aiken and Nigel D’Souza join us at 8:10am and 2:30pm, respectively, for their perspective on themes to watch. If you missed it, check out our primer here.
OPEC AT ODDS
West Texas Intermediate and Brent crude prices are slipping this morning as OPEC heads into two days of crucial meetings with no apparent consensus on output. Our Bloomberg News partners are reporting the cartel and its informal allies failed to agree in informal discussions yesterday whether to go ahead with the roughly 2 million barrels per day in additional production that’s set to take effect in January. OPEC begins its formal meeting today, with the full OPEC+ group meeting tomorrow – at which time we should find out how it plans to proceed.
TSX ON A ROLL
The Composite Index enters the week on a seven-session winning streak and has rallied almost 12 per cent so far this month. Top performer on the index in November is Aurora Cannabis (+155.4 per cent), worst performing stock is Agnico Eagle Mines (-20.2 per cent).
OTHER NOTABLE STORIES
-Renowned Montreal-based artificial intelligence company Element AI has agreed to be acquired by California-based ServiceNow. Terms weren’t disclosed. Element AI Co-Founder Yoshua Bengio will serve as a technical advisor to ServiceNow as part of the arrangement.
-Bombardier has a new chief financial officer. The business jet maker hired Bart Demosky, who previously served as CFO at Canadian Pacific Railway and Suncor Energy. He replaces John Di Bert, who is leaving without much explanation.
-Artis REIT will be a stock to watch today after the company struck a deal with activist shareholder Sandpiper Group. Under the deal, Sandpiper’s five nominees will be appointed to the company’s board, while CEO Armin Martin will retire next month and CFO Jim Green will step aside next year.
-Shares of Moderna have been up more than 10 per cent in pre-market trading after the company announced it will seek emergency use authorization today in the U.S. as well as conditional approval for its COVID-19 vaccine in Europe. The Massachusetts-based biotech also released updated efficacy information that was consistent with the preliminary information released earlier this month.
-A slew of notable government announcements over the weekend: Public Safety Minister Bill Blair and Health Minister Patty Hajdu announced restrictions on international travelers arriving in Canada from countries other than the U.S. have been extended to Jan. 21. Hajdu also announced a ban on certain drug exports just as the U.S. opens the door to imports from this country. And Agriculture Minister Marie-Claude Bibeau narrowed the window to disburse the remaining $1.4 billion in funding for farmers whose industry is affected by CETA and TPP.
-Shares of CNOOC – best known in these parts for its controversial takeover of Nexen – have been down as much as 14 per cent in Hong Kong after Reuters reported the oil producer will be added to a U.S. blacklist of Chinese companies with alleged military ties.
-Black Friday was very good to Shopify and its merchants. The company says a record US$2.4 billion in sales were executed via its platform on Friday, representing a 75 per cent surge from last year.
- S&P Global is buying IHS Markit for US$44 billion, including almost US$5 billion in assumed debt. It’s an all-stock deal uniting key data providers to the financial industry.
-The Globe and Mail is reporting online mental health service provider MindBeacon is preparing to file for an initial public offering on the TSX.
NOTABLE RELEASES/EVENTS
-Notable data: Canadian current account balance, Canadian building permits,
-Notable earnings: Zoom Video Communications, Organigram Holdings
-8:00 a.m. ET: OPEC holds virtual meeting
-1:00 p.m. ET: Nutrien holds investor day presentation
-~4:00 p.m. ET: Finance Minister Chrystia Freeland delivers Fall Economic Statement
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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