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Noah Zivitz

Managing Editor, BNN Bloomberg

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The S&P/TSX Composite’s dependence on financials and energy stocks is serving it well in the early days of 2022 as the world frets about inflation. Those are the only two subgroups trading meaningfully higher so far this year, with gains of four and almost 10 per cent, respectively.

We’ll see how those drivers fare today as investors hang on every word about the outlook for interest rates, which will surely be addressed when Lael Brainard attends a nomination hearing for her role as vice-chair of the U.S. Federal Reserve. Meanwhile, West Texas Intermediate crude is flat this morning after rising 5.6 per cent in the last two sessions thanks to shrinking U.S. stockpiles.

IN CONVERSATION WITH JIM PATTISON

The billionaire Canadian business magnate joins Jon this afternoon. We’ll get his assessment of the current bout of inflation compared to what he’s previously witnessed. Don’t miss the conversation shortly after 1 p.m. ET.

ENERGY WATCHDOG PRAISES AND WARNS CANADA

The International Energy Agency is out with a 261-page report on this country’s energy policies. If you’re a glass half-full type, you might appreciate the IEA’s praise for Canada’s clean electricity supply and its efforts on navigating the energy transition. However, the IEA also cautioned we need “clear policy signals to help attract energy sector  investments that align supply capacity with demand trends” and said “the environmental profile of oil sands  production, in particular, will become a greater focus for importing countries and warrants action.”

ARITZIA IS TOO POPULAR FOR ITS OWN GOOD

That’s a takeaway from the retailer’s latest quarterly report, in which it said it’s been experiencing “revenue pressure” because its fiscal third-quarter and holiday sales were so far ahead of expectations that it was left with “meaningfully lower” inventory for end-of-season sales. Revenue and profit came in way ahead of expectations in the latest quarter, the fourth-quarter revenue forecast is ahead of estimates, and the full year-revenue outlook has been raised. Toss in a share buyback, and what’s not to like? We’ll go in depth with Chair and Chief Executive Brian Hill shortly after 9 a.m. 

EASING OFF TRUCKER VAX REQUIREMENTS

Temur Durrani had some fantastic reporting for BNNBloomberg.ca yesterday on how truckers were feeling about the rapidly approaching new vaccine requirement for cross-border activity that was set to take effect on Jan. 15. The industry association had been up in arms about the potential threat to supply chains. Well, late yesterday it apparently won a reprieve. There are multiple reports that the Canada Border Services Agency will allow unvaccinated Canadian truckers to cross the border after all. We’ll speak with the head of the Canadian Trucking Alliance shortly after 11 a.m.

OTHER NOTABLE STORIES

  • Imperial Oil and ExxonMobil are shopping around XTO Energy Canada, their jointly owned Canadian shale business. Imperial said the decision to market the business is consistent with a strategy to focus on its oil sands operations.
  • Canadian National Railway says it’s asking the U.S. Surface Transportation Board to force Canadian Pacific Railway to sell Kansas City Southern’s Springfield Line to CN as a condition of approving the proposed takeover.
  • Corus Entertainment outpaced revenue expectations in its fiscal first quarter, as a 16 per cent surge in television advertising revenue powered growth.
  • Reitmans announced late yesterday afternoon that its restructuring has wrapped up and that it is no longer shielded from creditors under the Companies’ Creditors Arrangement Act. It’s emerging armed with a $115-million credit facility provided by Bank of Montreal.  The Montreal-based retailer filed for CCAA in May 2020 as the pandemic walloped its business.
  • We’ll watch shares of Fiera Capital total after Natixis said it’s selling all of its 10.68 million shares in the asset manager. Fiera will repurchase and cancel 3.56 million of those shares; the rest will be sold in a bought-deal block trade.
  • Tamarack Valley Energy, which is the second-best performing stock on the TSX this year, has confirmed it will go ahead with an inaugural monthly dividend of $0.0083 per share being paid out on Feb. 15. The company also said today it’s planning at least a quarter billion dollars in capital spending this year.
  • SSR Mining is selling its Pitarrilla project in Mexico to Endeavour Silver for up to US$127 million in cash, shares and a royalty.

NOTABLE RELEASES/EVENTS

  • Notable data: U.S. initial jobless claims and PPI
  • Notable earnings: Cogeco, Corus Entertainment, Delta Air Lines
  • 800: Philadelphia Federal Reserve President Patrick Harker addresses Philadelphia Business Journal Economic Forecast Series
  • 1000: U.S. Senate Banking Committee holds nomination hearing for Lael Brainard as U.S. Federal Reserve vice-chairman
  • 1030: U.S. President Joe Biden delivers update on COVID-19 surge response
  • 1200: Alberta Labour and Immigration Minister Tyler Shadro and Jobs Minister Doug Schweitzer discuss new plan to attract global tech talent
  • 1200: Natural Resources Minister Jonathan Wilkinson participates in launch of International Energy Agency's in-depth review of Canada's energy policies
  • 1400: Chicago Federal Reserve President Charles Evans discusses economy and monetary policy at Milwaukee Business Journal event