Royal Bank of Canada's trading division led the way to a profit beat in the first quarter. Full credit to the bond desk here – capital markets revenue was up nine per cent from a year ago, with net income of $1.223 billion on higher fixed income trading. That said, it’s still a mixed bag, which is sort of becoming a theme with this quarter of bank earnings. Provisions for credit losses came in at $532 million (that cash set aside for potentially sour loans) and that Canada Recovery Dividend ate up a tad more than a billion dollars in the quarter. There’s also the issue of expenses – up 16 per cent year-over-year (not to mention six per cent quarter-over-quarter), so things aren’t perfectly rosy.

NATIONAL ALSO TOPS ESTIMATES

Same sort of idea out of National Bank – another beat, albeit one with the same sort of warts. Revenue out of the financial markets division was up 4.1 per cent in the quarter ($689 million, for those keeping track at home,) which is pertinent, given that division contributes the largest proportion of revenue for it when you compare National to the rest of the Big Six. But back to that theme mentioned up top – PCLs came in at $86 million, and similar to RBC and Scotia yesterday, there were gripes about the Canada Recovery Dividend and its impact on results.

NFI POSTS NARROWER-THAN-EXPECTED LOSS

It’s been a tough go of it for bus-maker NFI Group, but it looks like things may be turning a corner. Adjusted loss in the company’s latest quarter came in at $0.31 a share, topping analyst estimates for $0.51 per share loss. All that said, supply chain disruptions continue to plague the company, and there’s probably a lesson here about the impact of having longer-order timelines. NFI says that while 2023 is expected to be a significant improvement on 2022, it’s still looking at inflation pressures due to contracts signed in 2020 and 2021, but with parts prices at 2023 levels.

OTHER NOTABLE STORIES

  • Alberta is projecting a $2.4 billion surplus this year, but is also increasing expenditures across the board – notable ahead of the scheduled election in May.
  • Enbridge is planning an additional $3.3 billion in spending to grow the business, with a particular focus on infrastructure tying it to the U.S. gulf coast. 

NOTABLE RELEASES/EVENTS

  • Notable data: Calgary Real Estate Board (CREB) home sales, S&P Global Manufacturing PMI, ISM Manufacturing PMI, U.S. Construction Spending
  • Notable earnings: Royal Bank of Canada, National Bank of Canada, George Weston, Canfor Corp., NFI Group, Dollar Tree, Wendy’s Co., Kohl’s Corp., Abercrombie & Fitch, Lowes, A&W Revenue Royalties Income Fund, Salesforce, Tricon Residential, Tourmaline Oil, Descartes Systems Group, AutoCanada