Mar 24, 2023
The Daily Chase: Markets point to negative open; U.S. President Biden visits Canada
First Look With Surveillance: UBS, Yellen, EU Meets
It's looking like investors are in for a rough ride to end the week as attention shifts back to concerns over the state of the global banking sector. Futures on the three main indices south of the border are down across the board, with the Dow and S&P 500 each shedding the better part of one per cent. Now, that's not nearly as bad as the final trading day of the week in Europe (where those banking concerns are concentrated today), where indices are broadly about two per cent lower. You can almost pick your problem child in the European banking sector today – shares of Deutsche Bank have been down as much as 15 per cent, while UBS is down a little more than eight per cent to cap off the week. To be fair, a bit of skittishness was probably to be expected after last weekend's dramatic shotgun wedding between UBS and Credit Suisse – confidence to hold one of those troubled European bank stocks through the weekend when you're unable to unload your position can be hard to come by.
BIDEN'S CANADIAN VISIT RAMPS UP
Today's the big day for U.S. President Joe Biden's first official visit to Canada since taking the Oval Office more than two years ago. Biden and Prime Minister Justin Trudeau will be holding bilateral meetings through the morning, followed by remarks in the House of Commons at 2 p.m. EDT and a media availability shortly before 4 p.m. EDT. On the agenda, we're expecting some progress on irregular migration, perhaps a bit more on defence spending plans and the clean energy transition. Stay tuned to BNN Bloomberg – we'll bring you the speeches before Parliament and media availability live this afternoon at 1:45 p.m. EDT.
ONTARIO INCHES TOWARD SURPLUS
Canada's largest province has a plan to get back in the black. Ontario is now forecasting a return to surplus in fiscal 2024-25 – albeit a modest $200-million surplus – following a $1.3-billion deficit in the coming fiscal year. As for this past year, the deficit is predicted to have come in at $2.2 billion – narrower than the previous forecast of $6.5 billion, and far below the initial view of a near $20-billion shortfall. Still, there are risks in the forecast – the provincial government is warning that it thinks economic growth will flatline this year as the global economy continues to navigate higher inflation, concerns over the potential for a recession and turmoil in the banking industry.
ENBRIDGE SUFFERS SETBACK ON LINE 5 TUNNEL
Looks like Enbridge is going to have to wait a good while longer before it can get the greenlight to build a tunnel under the Straits of Mackinac to protect the Line 5 pipeline. The U.S. Army Corps. of Engineers are delaying an environmental review of the project by two years – originally set to be published late this year, that review will now have to wait until Spring 2025, prolonging the timeline on a project that has proven to be a political flashpoint between Canada and the United States. Enbridge has been locked in legal battles with Michigan Governor Gretchen Whitmer for several years, with Whitmer seeking to halt flows through the pipeline, citing environmental concerns after Line 5 was struck (but not ruptured) by a boat anchor back in 2018.
OTHER NOTABLE STORIES
- Onex is moving its Gluskin Sheff advisor teams over to RBC Wealth Management, and will wind down its wealth management and wealth planning ops not transferred to RBC. Worth noting two things: Onex expects to book a non-cash charge on the deal (update on the exact amount is expected in May), and this move comes basically four years to the day since Onex first announced it was buying Gluskin for $445 million.
- Curaleaf is delaying the release of its fourth-quarter and full-year financial results, citing the complexity of concerting to a new accounting standards. The company now expects to report its results in April.
- Canadian retail sales rose 1.4 per cent in January – up from a downwardly-revised flat reading in December – led by higher sales of motor vehicles and parts. StatsCan's flash estimates sees things reversing in February, where it expects sales to have decreased by 0.6 per cent.
- Notable data: Retail Sales, U.S. Durable Goods Orders
- U.S. President Joe Biden in Canada