Noah Zivitz

Managing Editor, BNN Bloomberg

Archive

Canada’s economy shrank the most on record in April. New data this morning show an 11.6 per cent contraction in the month. There was nowhere to hide, with every sector tracked by Statscan under water in April – including double-digit declines in some key areas like manufacturing and construction. In a glimmer of hopeful news, Statscan is suggesting Canada may have started turning a corner in may – with a preliminary estimate that the economy grew three per cent last month.

CINEPLEX WARNS ON ITS FUTURE

This is what it has come to for Canada’s largest movie theatre operator in the aftermath of a failed takeover and the great unknown of COVID-19’s ultimate impact: “Material uncertainties lend significant doubt about the company’s ability to continue as a going concern,” Cineplex said about its liquidity in a regulatory filing. It came alongside a first-quarter report that shows revenue sank 22.4 per cent in the three months ending March 31, while its net loss ballooned thanks to impairments. In a bit of good news, Cineplex says it managed to secure some immediate covenant relief from its lenders. We’ll go in-depth on all of this with CEO Ellis Jacob at 10:05 a.m. ET.  

NEW NAFTA EVE

The updated North American Trade Agreement enters into force tomorrow, ushering in a new era for intellectual property protection, dairy sector access, automotive rules of origin, duty-free shipping, and countless other layers of the economy. We'll set the scene today, including with Ambassador Kirsten Hillman and one of her predecessors, Frank McKenna.

POWELL, MNUCHIN TESTIFY         

The heads of the U.S. Federal Reserve and U.S. Treasury Department will face two hours of questions from lawmakers today on the fiscal and monetary intervention that helped keep the economy and financial system afloat at the onset of the pandemic. Nothing surprising in Fed Chair Jerome Powell’s prepared remarks, which largely focus on recapping the emergency facilities established to keep credit flowing. He also cautioned, again, that “the path forward for the economy is extraordinarily uncertain” and that the Fed will “put [its] tools back in the toolbox” after the emergency subsides.

FACEBOOK UNDER PRESSURE

Pfizer and Puma are among the latest big corporate names to halt advertising on Facebook, with both announcing they’re joining a widening boycott designed to put more pressure on the social media giant to stamp out hate speech on its platform.

TSX QUARTER IN REVIEW

After plunging almost 22 per cent in the first three months of this year, the S&P/TSX Composite Index mounted a comeback in the second quarter – with a 15.03 per cent gain through the end of trading yesterday. Watch for a detailed breakdown of the rally on BNNBloomberg.ca later today.

OTHER NOTABLE STORIES

- Lululemon shares are rising in pre-market trading after the company announced late yesterday it will buy on-demand workout platform Mirror for US$500 million. CEO Calvin McDonald called it an opportunity to “enhance our digital and interactive capabilities, and deepen our roots in the sweatlife.”

- Royal Dutch Shell warned today that it will have to take up to US$22 billion in post-tax impairment charges due to the pandemic’s impact on prices and demand. The writedowns will cut across multiple business lines, with Shell’s liquefied natural gas business facing the heftiest impairment.

- Alimentation Couche-Tard’s fiscal fourth-quarter revenue plunged 26 per cent as COVID-19 pummeled demand for fuel; nevertheless, the company’s adjusted profit soared 80.8 per cent as fuel margins improved and amid what CEO Brian Hannasch described as “impulse and emergency” purchases.

NOTABLE RELEASES / EVENTS

- Notable data: Canadian GDP (April)

- Notable earnings: FedEx

- 9 a.m. ET: Parliamentary Budget Officer releases updated costing note on Canada Emergency Business Account

- 12:30 p.m. ET: U.S. Federal Reserve Chair Jerome Powell and U.S. Treasury Secretary Steven Mnuchin address House Financial Services Committee hearing on U.S. pandemic response

- 1:30 p.m. ET: Michigan Circuit Court holds preliminary injunction hearing regarding Enbridge Line 5 

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