|Bid||60.67 x 3200|
|Ask||0.00 x 800|
|Day's range||58.51 - 60.95|
|52-week range||46.45 - 87.62|
|Beta (5Y monthly)||1.09|
|PE ratio (TTM)||6.93|
|Forward dividend & yield||4.16 (7.00%)|
|Ex-dividend date||25 Mar 2020|
|1y target est||N/A|
(Bloomberg) -- Oil plunged Tuesday to the weakest level since the start of the month as investors weighed whether the world’s biggest producers will be able to strike a deal that cuts enough output to offset an unprecedented demand loss from the coronavirus outbreak.Futures in New York sank over 9%, reversing an earlier gain. Saudi Arabia and Russia are hammering out terms to a production agreement with OPEC+ talks planned for Thursday and a G-20 meeting of energy ministers set for Friday, according to people familiar with the matter.“There is a concern an OPEC+ deal is not enough or fast enough to prevent storage fills,” said Rebecca Babin, senior equity trader at CIBC Private Wealth Management.It’s also unclear if the U.S. will implement mandatory production cuts. The Energy Information Administration cut its oil production forecast for this year by more than 1 million barrels a day and trimmed its 2021 output estimates by 1.6 million barrels a day.“The EIA report today demonstrates that there are already projected cuts of 2 million barrels per day, without any intervention from the federal government,” according to an agency official. “The private sector and the free market are driving those cuts.”Also, investor funds are rolling over their positions into the forwards months by selling the prompt futures contract. The largest oil ETF, United States Oil Fund, started its five-day roll period Tuesday, and this will end on April 13.The fund is “selling the front month to buy the next three months,” Babin said, noting that the fund accounts for 10% of the open interest in the prompt contract.The May-June West Texas Intermediate spread widened to a $5.06-a-barrel discount, the weakest since 2009. Supplies at the key Cushing, Oklahoma, storage hub are the highest since November and are set to grow as the virus continues to destroy demand.An effective supply deal will require all of the three top producers -- the U.S., Saudi Arabia and Russia -- to participate. While Riyadh and Moscow are set to cut output significantly, according to people with knowledge of the negotiations, Washington is more likely to offer up gradual reductions. The G-20 may be a more acceptable forum to bring on board the U.S. and other big producers outside the OPEC+ alliance, such as Canada and Brazil.Even if a production-cut deal is reached, the bigger question is whether reductions would be enough to offset a demand meltdown spurred by the Covid-19 outbreak.See also: In the Big OPEC++ Output Deal, Who’s In and Who’s Out?The industry-funded American Petroleum Institute reported a 11.9 million barrel increase in weekly nationwide crude stocks, according to people familiar with the matter. That’s above analysts expectation for a 9.25 million barrel rise. The industry group also reported a 6.8 million barrel jump in oil stocks at the Cushing, Oklahoma hub, which would be the largest in data going back to April 2004 if the EIA confirms that in its report Wednesday.For transportation fuels, API reported a 9.45 million barrel increase in gasoline stocks, and a modest decrease in distillate inventories for the week ending April 3, people familiar with the matter said.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg) -- Prime Minister Justin Trudeau has opened the government’s coffers to businesses in an effort to save a Canadian economy on life support due to the Covid-19 pandemic.The government’s fiscal stimulus package now totals C$202 billion ($145 billion) after today’s measures, which include wage subsidies, government-backed credit lines and more tax deferrals to inject cash into the country’s nearly 1.2 million small- and medium-sized businesses.Trudeau unveiled the measures hours after the Bank of Canada lowered its policy rate to 0.25% and said it would begin large-scale asset purchases for the first time.“Our government knows you’re really feeling the impacts of this pandemic, especially with the end of the month coming up,” Trudeau told reporters outside his residence, where he continues to govern while self-isolating.There is more to come. Finance Minister Bill Morneau told journalists Friday “there’s not a cap” on what the government will spend to safeguard the Canadian economy. Further relief measures, specifically for the oil and gas and airline sectors, will come in the “not too distant future.”The economy is now sliding toward its most severe slump in decades because of the pandemic, with one bank predicting it will shrink 25% in the second quarter on an annualized basis.The country saw 929,000 unemployment claims last week, crushing all records. The new measures, including a 75% subsidy on wages, up from 10%, are designed to encourage companies to keep workers on the payroll.‘Mission Critical’Under the C$25 billion Canada Emergency Business Account, some small business owners will be able to apply for up to C$40,000 in loans, which will be guaranteed by the government. Loans will be interest-free for the first year and up to C$10,000 can be forgiven if certain conditions are met.Ottawa will also offer a further C$12.5 billion in credit for small- and medium-sized businesses via two financing agencies, Export Development Canada and the Business Development Bank Canada.Perrin Beatty, Chief Executive Officer of the Canadian Chamber of Commerce, welcomed the government’s response.“That’s critically important because it keeps employees connected to their jobs, which will dramatically reduce the amount of time required to ramp up production once the recovery kicks in,” he said in an email.The emergency loans and other liquidity measures are vital to making sure companies survive the pandemic, he said. “This is also mission critical to the recovery because it will help ensure that Canadians have a job to go back to.”Trudeau this week also announced a plan to help workers whose income has been hit by the coronavirus. Employees inside and outside the unemployment insurance system and the self-employed can apply to receive C$2,000 each month for four months.Bank FirepowerThe Bank of Canada’s actions were aimed at easing blockages in the markets and ensuring credit can flow, Governor Stephen Poloz said.The central bank has lowered its policy rate to 0.25% once before, during the global financial crisis. But its asset-purchase program breaks new ground. The bank said it will purchase a minimum of C$5 billion a week in government securities as well as short-term debt issued by companies.This month, the Bank of Canada has lowered interest rates by 150 basis points and created a series of programs to inject cash into the financial system. But Poloz acknowledged that monetary policy can only achieve so much during a pandemic, since entire parts of the economy are basically shut down.“We can help cushion the blow and lay foundations but with businesses closed, it’s not as though low interest rates are encouraging people to go out and spend and to boost economic growth. That just isn’t the case,” Poloz said during a press briefing Friday.Still, he said the bank has unlimited firepower through its debt purchase programs to keep financial markets functioning and lay the groundwork for a rebound.“While central bank stimulus can’t bring the economy back to life on its own, the Bank of Canada’s actions will help alleviate some of the pain and will support the recovery, whenever that begins,” said Canadian Imperial Bank of Commerce economist Royce Mendes in a note Friday.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg) -- Canada’s biggest banks have fielded hundreds of thousands of requests from homeowners seeking to hold off making mortgage payments under a new coronavirus-related relief plan.More than 213,000 requests to defer or skip payments have been completed or are being processed since the country’s six largest banks announced the plan last week, according to Mathieu Labreche, a spokesman for the Canadian Bankers Association In less than 10 days, the banks have deferred payments or are processing deferrals on about 4.5% of the total number mortgages in their portfolios, he added.“The large number of customers that have been helped continues to grow as the result of concerted efforts by front-line workers, contact-center agents and operations teams working diligently,” Labreche said in an interview Thursday.Royal Bank of Canada, Toronto-Dominion Bank, Bank of Nova Scotia and three other large lenders announced plans on March 17 to provide financial relief to Canadians impacted by the economic consequences of Covid-19, with mortgage deferrals among the measures introduced. Customers in good standing who have been impacted by the pandemic can apply, with deferrals available for an indefinite period and no deadline to apply, according to the association.Under the plan, payments are skipped for a period of time, and interest accrued is added to the mortgage’s outstanding balance. The additional interest is incorporated into future monthly payments when they resume, or upon renewal at the end of the mortgage’s term.Digital CapabilityThe lenders, which also include Bank of Montreal, Canadian Imperial Bank of Commerce and National Bank of Canada, had about C$1.06 trillion ($750 billion) in mortgage balances at the end of January, representing nearly two-thirds of the country’s overall mortgage market, according to financial statements and Bank of Canada data.The lenders are reporting higher volumes of calls related to mortgages and other loans, along with requests for deferrals, since the relief plan was introduced.“Last week, our contact centers in Canada received close to 80,000 calls per day, with calls to our mortgage and loan teams up 500%,” Scotiabank Chief Executive Officer Brian Porter said in a March 22 statement.CIBC is among banks adding digital capabilities so customers can make requests without going to branches, while boosting staff in contact centers and increasing outreach by advisers.“The need of Canadians for relief and support is at a scale and urgency we have never seen before as an industry and as a bank,” Laura Dottori-Attanasio, who oversees personal and business banking in Canada, said in a statement. “While we have helped tens of thousands of clients in the first week, we know we have much more to do.”Toronto-Dominion is “receiving thousands of requests daily for mortgage deferrals, and have processed thousands already,” spokeswoman Julie Bellissimo said in an emailed statement. “We are moving quickly through applications so that we can help provide our customers some immediate financial relief.”(Updates with magnitude of mortgages in second paragraph and company comment from sixth.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg) -- If traders hoped Friday’s turnaround would prove more than a moment of relief for the world’s shell-shocked markets, an emergency interest-rate cut by the Federal Reserve and coordinated steps by other central banks failed to bring any lasting sense of stability.The dollar fell across the board as the U.S. central bank lowered rates to 0%-0.25%, a level last seen in the wake of the 2008 financial crisis. The yen climbed more than 1% and the euro erased losses to add 0.7%. The currency market was the only one active among major markets when the Fed measures were announced. S&P 500 futures tumbled more than 4% as trading began at 6 p.m. in New York, tripping exchange trading curbs, as contracts on Treasuries surged. Rates strategists warned that part of the U.S. yield curve could soon turn negative.Traders were pricing in another steep rate reduction to address the fallout from coronavirus at the Fed’s March 17-18 meeting but the timing and extent of Sunday’s announcement still came as a shock. Beyond the rate cut, the Fed promised to boost its bond holdings by at least $700 billion and said it would allow banks to borrow from the discount window for as long as 90 days and reduce reserve requirement ratios to 0%.“It’s pulling Wednesday’s meeting forward -- a rate cut, QE and swap lines to make sure the market plumbing is working sufficiently,” said Mark McCormick, global head of FX strategy at Toronto Dominion Bank. “The knee-jerk is negative for the U.S. dollar given the Fed has now slashed the cost of selling it.”Fed Chairman Jerome Powell will hold a press conference at 6 p.m. Washington time to discuss the actions. The Fed also united with five counterparts to ensure dollars are available around the world via swap lines, the statement aid.The options market signaled that currency volatility remains elevated after one of the most turbulent weeks since 2008 amid funding concerns that stoke demand for the greenback.“The USD should absolutely be sold,” Bipan Rai, North American head of foreign exchange strategy at Canadian Imperial Bank of Commerce, wrote in a message. “The Fed just implemented emergency measures and cut rates to zero while expanding its balance sheet by 16%. That’s a bad concoction for the greenback.”Earlier, the Reserve Bank of New Zealand set the tone for what promises to be another busy week for monetary policy, cutting its key rate to 0.25% from 1% in an emergency decision in Wellington.The nation’s currency plunged to its lowest since May 2009 in early trading Monday after the decision, before erasing that loss when the Fed followed with its own unexpected cut. Australia’s currency -- which tends to rise and fall with risk appetite -- swung to a gain after touching its weakest since 2008 and the Norwegian krone bounced back from a fresh record low versus the greenback.While governments and central banks around the world announce unprecedented economic-stimulus measures -- indicating a growing willingness to coordinate their actions -- economists say virus-triggered closures and national lockdowns are making a global recession all but unavoidable. That means further market gyrations in the week ahead, gains for havens such as U.S. Treasuries, and more nervousness in stocks, commodities and emerging markets.“While the drop in rates to zero was priced in for the Fed this week, the timing of the rate cut itself has taken many by surprise,” said Simon Harvey, an FX analyst at Monex Europe. “Markets have already bullied the Fed into cutting rates to zero, but the associated liquidity package all in one day dwarfs what was seen after 2008.”Here are more comments, made before the Fed’s action, on what to expect as markets open Monday:Andrew Sheets, Morgan Stanley’s chief cross-asset strategist:“Global markets are facing their gravest challenge since the Great Recession”“COVID-19 will have a dramatic impact on the global economy and has raised the risk of a U.S. and global recession. It is a negative shock to both supply and demand, one that is uniquely difficult for policy makers to ‘fix”’“Given the speed and one-way nature of the current sell-off, we think that the probability of a reversal, at least temporarily, has increased”“The catalyst, we think, will be market weakness helping to elicit a more aggressive policy response”“The start of QE by the Fed, last week’s expansion of QE by the ECB and the Bank of Japan’s acceleration of ETF purchases are starting to look more and more like a coordinated policy response”“Strategically, we’ve closed our cautious position in U.S. equities, and are gradually closing a cautious position in U.S. credit.”James Reeve, the chief economist at Samba Financial Group in Riyadh:Recent government measures “are very welcome, and the market is responding positively to them. Whether or not is going to be enough to go beyond and calm financial markets dislocations we have seen in different segments and to lift the economy back into growth, I’m not so sure”“There still is an awful large overhang of debt in the U.S. corporate sector, and if high-yield continues to spike, then you have got a problem. Even if high-yield comes back down, it is a consumption-based economy, and people are staying at home, and that is the real worry. Corporate profits are just going to fall”The Federal Reserve is right “to target those sectors of the credit market that are distressed. I think most people are expecting a further 50 basis-point cut this week, which is positive”“Bond markets will be looking beyond fiscal stimulus and what it means for debt loads.”Ryan Lemand, the senior executive officer at ADS Investment Solutions Limited in Abu Dhabi:“This is the time of central banks and, unfortunately, they lost very, very valuable ammunition over the past few years trying to avoid the recessions”“We are still rolling into Chinese assets, where we see bargains”“We are also advising clients to look into” assets in the nations of the Gulf Cooperation Council“The GCC, in our opinion, has taken the right stance for very strict containment and they are taking commensurate actions from the central banks to go hand in hand with the legacy policies, such as relaxing loans.”Edward Bell, senior director for market economics at Emirates NBD PJSC in Dubai:“At the moment, uncertainty in markets is paramount and the modest rally we saw on Friday for both Brent and WTI, amid a surge in equity prices too, probably reflects positioning more than fundamentals.”“As global travel comes as close to an abrupt halt as is seemingly possible and major economies hit the pause button the impact on oil demand going forward will most likely be worse than the IEA’s recent downside risk projections.”D’Ambrosio, the Malta-based chief executive officer at Axiory Global.“In this situation and in absence of further shocks as the coronavirus epidemic unfolds, the stock market might regain some more terrain in the coming week, with bond yields rising, especially in the U.S., and gold possibly further shedding some more of the gains posted earlier this year. Such a scenario might be reinforced by the coronavirus situation in China normalizing, as seems to be the case”“The FOMC meeting will be crucial to set the mood for the entire week. As a cut of at least 50 basis points is almost certain, the focus will be on the other measures that will be announced in order to support the financial markets and avoid, or at least limit, the extreme volatility we have experienced last week”“A monster $1.5 trillion plan has already been announced and implemented and the result has been the stock market surge on Friday. But still, every word of the Fed chairman statement will be weighed to understand what the Fed outlook and future moves are”“The coronavirus impacted on a situation that was already signaling stress, with the slowdown in global demand which started in 2018, along with the trade wars and the stock-market valuations, which have become dependent on external stimulus pumped in by central banks.”(Updates with currency moves from second paragraph.)\--With assistance from Filipe Pacheco, Michael G. Wilson and Vassilis Karamanis.To contact the reporters on this story: Susanne Barton in New York at firstname.lastname@example.org;Jack Pitcher in New York at email@example.com;Justin Carrigan in London at firstname.lastname@example.orgTo contact the editors responsible for this story: Jenny Paris at email@example.com, Rachel EvansFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg) -- The Bank of Canada cut interest rates by half a percentage point to buffer the nation’s economy against the double whammy of the coronavirus and tanking oil prices.The Ottawa-based central bank lowered its policy rate in an emergency move to 0.75% and said it “stands ready” to act again if needed. Governor Stephen Poloz, in a joint press conference Friday afternoon with Finance Minister Bill Morneau, also announced a new facility to acquire money market instruments used by small- and medium-size businesses “at a time when they may have increased funding needs and credit conditions are tightening.”“It is clear that the spread of the coronavirus is having serious consequences for Canadian families, and for Canada’s economy,” the central bank said in a statement. “In addition, lower prices for oil, even since our last scheduled rate decision on March 4, will weigh heavily on the economy, particularly in energy intensive regions.”This marks the first emergency rate cut by the country’s central bank since the 2008-2009 financial crisis and is part of a coordinated government-wide response to a slowdown that threatens to drive the nation’s economy into a recession. Morneau announced he would deliver a fiscal stimulus package next week, promising to do “whatever it takes” to keep the economy afloat.Friday’s measures emphasized the need to ensure funding markets remain liquid for businesses at a time of market stress. Morneau introduced an additional C$10 billion ($7.1 billion) in new funding for the country’s two business financing agencies -- the Business Development Bank of Canada and Export Development Canada.Jeremy Rudin, head of Canada’s banking regulator, said he would lower capital adequacy buffers for the nation’s banks, a measure that could generate as much as C$300 billion in additional lending capacity.The Bank of Canada will begin purchasing so-called Bankers’ Acceptance securities -- a money market instrument widely used by small and medium-sized corporate borrowers that may not have direct access to primary funding because of their size and credit ratings.“Targeting each vulnerable sector of the economy -- small and medium businesses, banks, households -- is strong,” said Ian Pollick, head of rates strategy at CIBC in Toronto. “They are serious about coming out fast and furious.”Market moves were muted with the Canadian dollar hardly budging on the news. It was trading at C$1.3918 per U.S. dollar at 3:48 p.m. Toronto time, little changed from Thursday.“Currencies no longer care about rate differentials,” said Simon Harvey, Forex Market Analyst at Monex Canada. “Investors are flocking to liquid dollars.”The growing number of coronavirus cases globally, the shock to oil prices and volatility in financial markets have prompted speculation Canada will undergo an economic contraction in the second and third quarters of 2020.The emergency rate cut was not entirely unexpected on the heels of the Bank of Canada’s March meeting, where it lowered interest rates by half a percentage point for the first time in more than four years. Still, the response represents a dramatic move in an effort to keep the economy running amid rapidly deteriorating financial conditions.“The Bank of Canada is taking concerted action to support the Canadian economy during this period of economic stress,” Poloz said. “The Bank’s Governing Council stands ready to do what is required to support economic growth and keep inflation on target, and we will continue to ensure that the Canadian financial system has sufficient liquidity.”(Updates with analyst comment in seventh paragraph.)\--With assistance from Kait Bolongaro and Shelly Hagan.To contact the reporters on this story: Theophilos Argitis in Ottawa at firstname.lastname@example.org;Erik Hertzberg in Ottawa at email@example.comTo contact the editors responsible for this story: Theophilos Argitis at firstname.lastname@example.org, Chris Fournier, Stephen WicaryFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg) -- Canadian stocks suffered a stunning 12% drop, the largest in eight decades, as investors size up the likelihood of a global recession because of the coronavirus pandemic.The S&P/TSX Composite Index had its biggest one-day decline since May 1940, according to data compiled by Bloomberg. The 230 companies in the benchmark collectively lost at least C$265 billion ($190 billion) in market value. Trading on the Toronto Stock Exchange was halted minutes after the market opened as a wave of selling tripped the circuit-breaker rule.The spread of a global pandemic that has killed more than 4,700 people has shocked financial markets and forced policy makers into emergency measures. The Federal Reserve said it is prepared to inject a total of $5 trillion into funding markets over the next month.The Bank of Canada also took steps to smooth the flow of credit. Late Thursday afternoon, the central bank said it will broaden the scope of a government bond buyback program and temporarily add repo operations with terms of six and 12 months “to proactively support interbank funding.”In equity markets, the selling was indiscriminate. One of the country’s largest pipeline operators, TC Energy Corp., saw its market cap fall almost C$13 billion. Shares of the Calgary-based company fell 22%, the most since 1984. Only one stock in the composite went up: auto parts maker Linamar Corp.“We’ve had a bull market which had to result in some relief at some point,” said Michael Smedley, chief investment officer at Morgan Meighen & Associates. “The situation at the moment is still for me ‘sitting on your hands’ rather than ‘catching the knife.’”A growing number of economists believe Canada is on the brink of recession as the economy takes a double hit from the coronavirus and tanking oil prices, ramping up pressure on Prime Minister Justin Trudeau’s government to come up with a sizable fiscal stimulus package. In the meantime, investors were left perplexed.“The most important thing right now is to focus on liquidity, focus on safe yields and non-cyclical parts of market,” including Canadian banks, David Rosenberg, founder of Rosenberg Research and Associates Inc., said in a phone interview. He’s “nibbling back into the market” and advising clients to look for stocks where dividends are safe.Rosenberg, the former North American chief economist for Merrill Lynch who has been forecasting a recession, thinks one has already begun in Canada and the U.S. “This is an absolutely horrible situation, at every level,” he said.Don’t bank on a quick bounce, said one analyst at Canadian Imperial Bank of Commerce. “The caveat here is that we do not believe there is a V-shape recovery given the magnitude of the recent technical damage in market internals,” the bank’s technical analyst Sid Mokhtari said in a note to clients.Oil is headed for the biggest weekly decline since 2008 after Saudi Arabia set off a price war over the weekend and President Donald Trump said the U.S. would restrict travel from Europe for the next 30 days in an attempt to contain the coronavirus, pummeling fuel demand.Trudeau himself is in self-isolation and working from home while his wife awaits the results of a Covid-19 test. Sophie Gregoire Trudeau had been exhibiting flu-like symptoms after recently returning from a speaking engagement in London, the prime minister’s office said in a statement. While her symptoms have subsided, she’s self-isolating at home as she awaits the test results.The prime minister isn’t exhibiting any symptoms.Meanwhile, provincial governments took further steps to try to slow the coronavirus outbreak. Quebec asked residents to quarantine themselves after any foreign trip and made a 14-day self-isolation mandatory for government workers. Ontario said public schools will close through April 5 and Alberta urged the cancellation of all gatherings of more than 250 people.(Updates with additional details on market drop, government and central bank response, and new chart)\--With assistance from Aoyon Ashraf, Steven Frank, Doug Alexander, Derek Decloet and Jacqueline Thorpe.To contact the reporters on this story: Divya Balji in Toronto at email@example.com;Michael Bellusci in Toronto at firstname.lastname@example.orgTo contact the editors responsible for this story: Courtney Dentch at email@example.com, Divya Balji, Steven FrankFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg) -- Canada appears on the brink of recession as the economy takes a double hit from the coronavirus and tanking oil prices, ramping up pressure on Prime Minister Justin Trudeau’s government to deliver a fiscal stimulus package.Bank of Nova Scotia, the country’s third-largest lender, became the first major Canadian bank to forecast the country will fall into a mild recession this year unless the government moves ahead with a fiscal stimulus plan. Similar near-recession calls could follow as forecasts are revised down in the face of rapidly deteriorating conditions.The downgrades come as Trudeau’s government takes a cautious approach to dealing with the slowdown, promising just C$1.1 billion ($800 million) in new funding to respond to the pandemic. In the absence of a significantly larger package, the rapid rise in coronavirus cases globally, sharp fall in oil prices and increasing volatility in financial markets will trigger an economic contraction, Jean-Francois Perrault, chief economist at Scotiabank, said Wednesday.“A reasonably mild recession appears likely unless timely and targeted fiscal measures are deployed in the very near future to deal with the economic impacts of the virus,” Perrault wrote in a research note.The Canadian government’s measures pale in comparison to more dramatic steps from central banks and governments around the world, with the Bank of Canada last week slashing interest rates by half a percentage point to restore confidence.Global ResponseThe Bank of England made an emergency rate cut Wednesday, in co-ordination with a 30 billion pound ($39 billion) stimulus package from Boris Johnson’s government. In Italy, Prime Minister Giuseppe Conte is ready to spend as much as 25 billion euros ($28.3 billion) on stimulus to shield its economy from the worst outbreak of coronavirus outside China.President Donald Trump, meanwhile, has opted to temporarily ban most travel to the U.S. from the European Union, while also laying out a series of fiscal measures to deal with the economic fallout. And on Thursday, Australia unveiled an A$17.6 billion ($11.4 billion) fiscal stimulus package.For Trudeau, it’s “likely that stimulus will end up needing to be far larger than what’s already been announced,” Royce Mendes, an economist at Canadian Imperial Bank of Commerce, said by telephone Wednesday. His bank is also forecasting domestic growth will turn negative in back-to-back quarters this year, a situation economists refer to as a technical recession.Domestic OutlookScotiabank sees the country’s gross domestic product growth slowing to 0.3% for the year, including two straight quarters of negative growth, in the absence of significant stimulus. Perrault recommends the government roll out a fiscal package equivalent to 1% of GDP, or just over C$20 billion, in order to prevent the Canadian economy from going into recession.National Bank of Canada, the country’s sixth-largest lender, also revised its forecasts for 2020 growth down to 0.6% on Wednesday. “Our expectation for a late-year economic recovery, which could extend into 2021, is predicated on rapid and significant policy responses, both from central banks and from governments,” National Bank’s economics team said in a note.Bank of Montreal was the first of the six banks to revise their forecasts lower this week, with a call for full year GDP growth at 0.5%. Goldman Sachs is predicting Canada’s economy is on the “verge of recession,” forecasting no growth in the first quarter of this year and a contraction in the second quarter.The latest stream of downward revisions include predictions that the Bank of Canada will cut rates to 0.25% by June from its current 1.25%. That’s in line with financial market expectations, according to overnight index swaps trading. The last time the Bank of Canada policy rate reached 0.25% was in 2009. Earlier this month, the central bank cut interest rates by 50 basis points amid escalating coronavirus concerns, matching an emergency move by the Federal Reserve.(Updates throughout to reflect broadening expectations of recession.)\--With assistance from Erik Hertzberg and Kait Bolongaro.To contact the reporter on this story: Shelly Hagan in ottawa at firstname.lastname@example.orgTo contact the editors responsible for this story: Theophilos Argitis at email@example.com, Chris Fournier, Stephen WicaryFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
(Bloomberg) -- Oil bounced back from its biggest plunge in 29 years on hopes the U.S. government will intervene to shield against the fallout of the coronavirus and a producer battle for market share.Futures jumped more than 10% in New York, the most since September, after Monday’s historic 25% slump. U.S. President Donald Trump vowed “substantial” economic measures to combat the coronavirus’ impact. He’s also pitched economic relief for the travel and hospitality sector, while some Republican senators have suggested a federal bailout for the shale industry.“Markets are rallying on signs there may be fiscal stimulus by the White House,” said Rebecca Babin, a senior equity trader at CIBC Private Wealth Management. “It’s all still so fragile and reactionary right now though.”The Trump administration’s willingness to provide stimulus comes as the collapse in oil prices spurred an indiscriminate sell-off in markets already reeling from the coronavirus. The U.S. has ramped up its response to the market-share war waged by Russia and Saudi Arabia as the collapse of the OPEC+ alliance threatens the American shale industry.The U.S. suspended a planned sale of 12 million barrels of oil from the nation’s emergency reserves. Trump also spoke with Mohammed bin Salman by phone before the Saudi crown prince escalated the oil-price war Tuesday by increasing production, according to two people familiar with the call.“The U.S. getting involved is a positive,” said Mike Hiley, head of OTC energy trading with LPS Partners. “It’s clear they’re concerned this price move threatens the viability of U.S. shale industry.”West Texas Intermediate crude for April delivery rose $3.23 to settle at $34.36 a barrel on the New York Mercantile Exchange, the largest jump since the attack on Saudi oil facilities in September last year.Brent for May settlement advanced 8.3%, or $2.86, to settle at $37.22 a barrel on the London-based ICE Futures Europe exchange.State-owned Saudi Aramco said it will boost production by 12.3 million barrels a day in April, exceeding the kingdom’s maximum sustainable rate of production, after slashing its official crude prices over the weekend.Russia’s largest producer said it will ramp up output next month, though Energy Minister Alexander Novak repeated that further cooperation with OPEC remains possible.The unprecedented supply-demand shock poses a serious threat to the U.S. shale boom with the potential to push crude prices to 2016 and 2008 lows in the short-term, according to IHS Markit.The turmoil also reverberated across time-spreads and options. Brent for prompt delivery collapsed against later shipments. The structure, known as contango, is a sign of bearishness and oversupply and makes it profitable for physical traders to buy crude and put it into storage.Meanwhile, the American Petroleum Institute is said to have reported that U.S. crude stockpiles increased 6.41 million barrels last week. The median forecast of analysts surveyed by Bloomberg before a government report Wednesday shows analysts are predicting a build of 1.7 million barrels.(An earlier version of this story corrected Monday’s closing price.)\--With assistance from James Thornhill and Dan Murtaugh.To contact the reporters on this story: Grant Smith in London at firstname.lastname@example.org;Elizabeth Low in Singapore at email@example.com;Jackie Davalos in New York at firstname.lastname@example.orgTo contact the editors responsible for this story: David Marino at email@example.com, Pratish Narayanan, Carlos CaminadaFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
In 2014 Victor Dodig was appointed CEO of Canadian Imperial Bank of Commerce (TSE:CM). This report will, first...
Canadian Imperial Bank (CM) delivered earnings and revenue surprises of 9.38% and 2.88%, respectively, for the quarter ended January 2020. Do the numbers hold clues to what lies ahead for the stock?
Canadian Imperial Bank (CM) possesses the right combination of the two key ingredients for a likely earnings beat in its upcoming report. Get prepared with the key expectations.
Victor Dodig, chief executive of Canada's fifth-largest bank, told staff on Thursday that CIBC needs to challenge itself to be "a more efficient bank by focusing on continuous improvement and keeping a careful eye on costs," according to a memo seen by Reuters. A CIBC spokesman declined to comment. CIBC has improved its efficiency ratio, which measures non-interest expenses as a percentage of revenue, to 55.5% in 2019 from 60.4% in 2015.
Passive investing in index funds can generate returns that roughly match the overall market. But in our experience...
Toronto-Dominion (TD) and Canadian Imperial Bank of Commerce (CM) will likely incur restructuring charges in fiscal 2020 to drive earnings growth, while other Canadian banks might not.