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Noah Zivitz

Managing Editor, BNN Bloomberg

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Scotiabank is urging Canadian policymakers to hold off on any immediate intervention to cool red-hot housing markets. In a report to clients, Scotia’s chief economist said the imminent spring selling season could “restore some balance” as listings perk up. But if action is necessary, Scotia advised against taxing all capital gains on the sale of principal residences. There’s some nuance in the call, as Scotia noted government could apply a targeted tax on quick flips by speculators. We’ll dig into all of this and more with Scotia Chief Economist Jean-François Perrault at 9 a.m. and keep the housing conversation going this afternoon with C.D. Howe Institute Senior Fellow Ed Devlin at 2:30 p.m. There’s some fresh data to wrap around this hot topic: the latest Nanos survey for Bloomberg News shows a record 67 per cent of Canadians expect home prices will continue rising over the next six months. And, on Friday, the Real Estate Board of Greater Vancouver said home sales in that region surged 126.1 per cent year-over-year in March. 

WHAT’S NEXT FOR TRANSAT?

That’s the big question after the takeover by Air Canada was abandoned on Friday as European opposition to the deal became too much to stomach. Transat walks away with a $12.5-million break fee in its pocket, freedom to explore alternatives (including the $5 per share proposal that was previously dangled by Pierre-Karl Péladeau), and continue its pursuit of at least $500 million in financing.

TRADING THE NEWS

Futures are pointing to gains at the start of trading in New York as North American equity markets re-open after the Easter holiday. The U.S. economy showed its strength on Friday with non-farm payrolls rising by 916,000 positions and the unemployment rate slipping two-tenths of a point to 6.0 per cent in March.

OTHER NOTABLE STORIES

  • Delta Air Lines is providing a lesson to the rest of the airline industry: be ready for the recovery. The big airline has had to cancel approximately 100 flights due to inadequate staffing.
  • Whitecap Resources announced another acquisition today. This time, it’s acquiring Kicking Horse Oil & Gas for $300 million in stock and cash to bulk up in Alberta’s Montney region. Whitecap says the deal will bolster its dividend’s sustainability and that it expects Kicking Horse’s production could climb from the current 8,000 barrels of oil equivalent per day to as much as 19,000 over the next 12-15 months.
  • The Alberta government is providing a $408-million grant to Inter Pipeline for its Heartland complex as part of the province’s incentive program to bolster the petrochemicals sector.  
  • Tesla will be a stock to watch today after the vehicle maker on Friday posted record quarterly deliveries of 184,800 in the first three months of this year.
  • GameStop shares have been down more than 10 per cent in pre-market trading after the company finally decided to cash in on investor interest by announcing it will issue up to 3.5 million shares in an at-the-market offering.

NOTABLE RELEASES/EVENTS

  • Notable data: ISM U.S. services index, U.S. factory orders