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Noah Zivitz

Managing Editor, BNN Bloomberg

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There’s no sign of relief for investors this morning. Aside from in China, major markets across Asia and Europe are sliding, and U.S. futures are indicating the rout will continue at the opening bells. That’s after the S&P 500 fell the most since June 11, 2020, in yesterday’s session. Here’s a basic question: did Target’s profit warning as it navigates inflationary pressure really justify losing 24.93 per cent of its value in a single session? What does that tell us about market psychology? And, most importantly, what’s an investor to do?

We’ll gather perspective from investing professionals, starting with long-time BNN Bloomberg/BNN/ROBTv guest Gavin Graham at 8 a.m. Sidebar for our market coverage: our Bloomberg News partners are highlighting a call by Goldman Sachs equity strategists who told clients “a recession is not inevitable.” Can’t wait to hear what Canada Pension Plan Investment Board CEO John Graham has to say about the macro environment when he joins Andy at 3:30 p.m. He’s joining us after CPPIB reported a 6.8 per cent return (with assets hitting $539 billion) for its fiscal year that ended in March.

GLOBALIVE TIES UP WITH TELUS IN PUSH FOR FREEDOM             

What a fascinating development as we wait to see if Rogers will be allowed to close its planned $20-billion takeover of Shaw. Globalive announced today it has a conditional network and spectrum-sharing deal with Telus. It’s conditional on Globalive buying Freedom Mobile. That’s the hot potato in the takeover situation, even more so after the Competition Bureau announced it wants to block the deal because of concerns about wireless competition. Reminder that Globalive’s Founder/Chairman Anthony Lacavera also launched the wireless carrier that was once known as Wind Mobile — before it was sold to Shaw in 2016.

TECH UNDER THE MICROSCOPE

Cisco Systems shares are down more than 10 per cent in pre-market trading after the network equipment maker slashed its full-year revenue and profit forecasts as revenue flat lined at US$12.8 billion in its fiscal third quarter. CEO Chuck Robbins pinned the blame on COVID-related lockdowns in China and Russia’s invasion of Ukraine. In Canada, BlackBerry is on our radar as its shares slip on the back of forecasts showing the company expects to nearly double revenue over the next half-decade, albeit while warning of a modest adjusted loss and cash burn this fiscal year. Lightspeed Commerce, whose stock has plummeted 49 per cent so far this year, is also on our agenda after reporting a 78 per cent jump in fourth-quarter revenue, albeit while forecasting a full-year adjusted loss that would be larger than the average estimate. We’ll speak with its CEO, JP Chauvet, at 9:10 a.m.

CHINA REPORTEDLY EYEING RUSSIAN OIL

While much of the Western world is cutting off Russian oil, Bloomberg News just reported China is poised for the opposite. According to Bloomberg sources, Beijing is in talks with Moscow to ramp up imports of Russian oil to rebuild its stockpiles. The story doesn’t indicate specifics on import volumes or terms of any potential arrangement.

KENNEY RESIGNS

For now, Jason Kenney’s decision to resign as premier after narrowly surviving a leadership vote feels like a purely political story. But at some point, there will be policy implications. And that’s where we’ll focus our energy. Tara will track developments as the United Conservative Party hunts for its interim and next-full time leader ahead of a provincial election that’s expected next May.

OTHER NOTABLE STORIES

  • Nutrien announced after markets closed that it’s planning to build what it’s dubbing “the world’s largest clean ammonia facility” at a cost of about US$2 billion. Final investment decision will be made next year. Site is TBC, though Nutrien said it’s eyeing Geismar, Louisiana.
  • Under Armour shares are falling in early trading after the apparel maker abruptly announced it’s hunting for a new chief executive. Current CEO Patrik Frisk will step down from his management role and from the board of directors on June 1. Frisk has served as CEO for barely two years after taking the job at the start of 2020.
  • Canada Goose is dodging the retail carnage (in terms of stock performance) that we’ve been reporting on this week. The parka maker’s shares are climbing in pre-market trading after reporting fourth-quarter revenue that was in line with expectations and forecasting full-year revenue that narrowly exceeds the average estimate. Margins have top of mind for the big box U.S. retailers that are navigating inflation pressure; so we’ll point out Goose’s fourth-quarter gross margin rose almost three points to 68.7 per cent.

NOTABLE RELEASES/EVENTS

  • Notable data: Canadian industrial product and raw materials price indices, U.S. initial jobless claims and existing home sales
  • Notable earnings: Canada Goose, Lightspeed Commerce
  • 800: Nutrien Interim President and Chief Executive Ken Seitz addresses BMO conference
  • G7 finance ministers and central bankers’ meeting in Bonn, Germany, continues