Noah Zivitz

Managing Editor, BNN Bloomberg

Archive

If Snap is a canary in the coal mine for its tech peers: look out below. The parent company of Snapchat is seeing its stock get thrashed in pre-market trading after its second quarter was rocked by a slowdown in ad spending. There were deep losses in the period, a jump in cash burn, and revenue that trailed expectations. In a letter to investors, Snap said “macroeconomic challenges have disrupted many of the industry segments that have been most critical to the growing demand for our advertising solutions.” On top of that, it’s still dealing with fallout from changes to privacy options in Apple’s operating software for iPhones. And so now Snap isn’t bothering to provide a forecast for the current quarter, though it said in its letter revenue is tracking “approximately flat” so far in Q3. Similarly, Twitter just reported second-quarter revenue that trailed expectations. But we know there’s a bigger issue at play, and that was acknowledged in the release, as the company said its revenue flat lined due to “advertising industry headwinds associated with the macro environment as well as uncertainty related to the pending acquisition of Twitter by an affiliate of Elon Musk.”

TSX ON A ROLL

The composite index has closed higher in five straight sessions and is in its longest winning streak since May, when it strung together seven straight days of gains. Shopify led the way yesterday, and single-handedly offset losses posted by energy heavyweights Suncor and Canadian Natural Resources as the price of oil slumped. This morning, the mood in equity markets is basically the equivalent of a shrug emoji, as major European indices trade little changed and U.S. futures have been mixed. Of note in Europe: manufacturing PMIs in Germany and for the euro-area as a whole slid into contraction territory this month. For some news you can use as we cap off another trading week, be sure to check out Dale Jackson’s latest Payback Time column for tips on how to protect your assets from the next downturn.

ROGERS EXPLAINS ITSELF

Today is the deadline for Rogers Communications to respond to the Canadian Radio-television and Telecommunications Commission’s demand for a “detailed account … as to ‘why’ and ‘how’” its network failed a few weeks ago. The regulator also wants to know what Rogers is doing to make sure an outage like that doesn’t happen again. We know the company took one step in that direction yesterday by appointing a new chief technology officer. It’s unclear when Rogers’ response to the CRTC will be made public; we’ll be watching for it. Just like we’ve been watching shares in its $20-billion takeover target, Shaw Communications’ Class B stock, languish far below the $40.50-per-share takeout price, signaling investors’ skepticism that the deal will close. And on that front, keep in mind the next outside date is July 31, though it could very well be delayed again.

CANADIAN SHOPPERS WHIPSAWED

Retail sales in this country surged 2.2 per cent in May, Statistics Canada reported this morning. That’s a tripling from April’s revised growth of 0.7 per cent. But, at the risk of overloading on numbers, the fly in the ointment is in the flash estimate. StatsCan says it looks as though sales inched up just 0.3 per cent in June. So, we might be seeing rapid shifts in consumer behaviour for all the obvious macro economic reasons.

OTHER NOTABLE STORIES

• Deborah Orida has been named president and chief executive officer of the Public Sector Pension Investment Board, which had $230.5 billion of assets as of the end of March. Orida joins PSP from the Canada Pension Plan Investment Board, where she was serving as global head of real assets and chief sustainability officer.

NOTABLE RELEASES/EVENTS

• Notable data: Canadian retail sales and manufacturing sales flash estimate
• Notable earnings: Twitter, American Express, Schlumberger, Verizon