TSX extends rally on commodity gains
Canada's got the best of both worlds. You’ve got the financials and all the resources kicking in," said Pyle. "So the litmus test now will be adding on to this week because now we're less than 200 points from the high we saw in January."
• TSX +98.50 to finish higher for a 3rd straight session, extending the “spring rally’ to a 6th week, with financial issues buoyed by optimism that quarterly U.S. bank results this week will show the sector has stabilized after being shaken hard in the global financial crisis.
• DOW -25.57Traders were uneasy after a New York Times report that the U.S. Treasury has directed GM to lay the groundwork for a potential bankruptcy filing by June 1.
• Dollar +.39c to 82.01USD
• Oil -$1.19 to $50.05US per barrel.
• Gold +$12.50 to $895.80USD per ounce
• Canadian 5 yr bond yields -.01bps to 1.85 four weeks ago it was 1.86. The spread between the 5 year bond yield and the Merix 5 year fixed rate is now 2.09%.
• http://www.financialpost.com/markets/market_data/money-yields-can_us.html
Wells Fargo to post record US$3B profit Wants to repay US$25-billion bailout cash Jonathan Stempel And Elinor Comlay, Reuters
Wells Fargo & Co. said it expects to post a record US$3-billion first-quarter profit, causing its shares to soar and providing a welcome jolt to the broader stock market and banking sector.
The fourth-largest U. S. bank is the first major U. S. lender to indicate how it fared in the January-March period.
Coming as the government performs "stress tests" on 19 major banks, the preliminary quarterly results suggest that lenders focused on traditional banking activities may handle the recession better than analysts and investors expect.
"In this terrible environment, to exceed on the upside is going to raise the bar pretty high," said Matt McCormick, an analyst at Bahl & Gaynor Investment Counsel in Cincinnati.
Wells Fargo said quarterly profit after preferred stock dividends was US$2.3-billion to US$2.4-billion, or US55¢ per share, on revenue of about US$20-billion.
Analysts on average expected profit of US25¢ per share on revenue of US$18.81-billion, Reuters said. Wells Fargo expects to report full quarterly results on April 22.
Tuesday, April 14, 2009
Monday, April 13, 2009
Financial Update for April 13, 2009
Banks, oils power TSX to fifth weekly gain
"We had some pretty dismal jobs numbers in Canada as unemployment rose to 8%, but that's been overshadowed by positive sentiment surrounding the financial sector," said Elvis Picardo, analyst and strategist at Global Securities in Vancouver. "Since the financial sector has been front and center in the midst of this turmoil, any improvement reflects positively on the rest of the economy and the rest of the equity markets."
• TSX +217.84 to 9,187.12 as financial issues got a lift from upbeat news from the U.S. banking sector and higher oil prices boosted energy shares.
• DOW +246.27
• Dollar +.80c to 81.62USD
• Oil +$2.86 to $52.24US per barrel.
• Gold -$2.60 to $882.50USD per ounce
• Canadian 5 yr bond yields +.04bps to 1.86 four weeks ago it was 1.90
• http://www.financialpost.com/markets/market_data/money-yields-can_us.html
Obama says U.S. economy beginning to show 'glimmers of hope'
Fri Apr 10, 3:37 PM Liz Sidoti, The Associated Press
WASHINGTON - U.S. President Barack Obama said Friday the economy is showing "glimmers of hope" despite continuing stresses, and he signalled more steps to brighten the business climate.
Obama commented to reporters after meeting at the White House with members of his economic team, including Treasury Secretary Timothy Geithner, economic adviser Larry Summers and Federal Reserve Chairman Ben Bernanke.
"What we're starting to see is glimmers of hope across the economy," the president said, although he also noted that the economy is "still under severe stress."
"Whatever we do ultimately has to translate into economic growth and jobs," Obama said.
He said there has been a significant uptick in the number of homeowners seeking to refinance their mortgages, which will put money back into their pockets. He said a 20-per-cent increase last month in the Small Business Administration's largest program means that small companies, often prized as the backbone of the economy, "are starting to get money."
But Obama also pointed to the high rate of joblessness - which climbed to a 25-year high of 8.5 per cent in March - and acknowledged that "we've still got a lot of work to do."
"We're starting to see progress," he declared, "and if we stick with it, if we don't flinch in the face of some difficulties, then I feel absolutely convinced that we are going to get this economy back on track."
Obama said he and his advisers discussed the stability of the financial system and a program to help banks clear their books of bad assets that have made normal lending difficult if not impossible.
Friday's meeting was Obama's first with his economic team since his return this week from an overseas trip partly focused on the global economic slump. He participated in a meeting in London of leaders from the 20 wealthiest and developing economies.
The backdrop for the meeting was the still-fragile economy that has begun to show hints of a possible recovery, including a strong profit forecast from Wells Fargo and Co., a drop in claims for unemployment benefits and predictions of solid April sales from several retailers.
Also promising were less jittery stock investors, shoppers and homebuyers, slowly thawing credit markets that were once frozen and stabilizing economic indicators that had been going from bad to worse.
All that has at least one Obama adviser sounding cautiously optimistic.
"There has been a substantial anecdotal flow over the last six to eight weeks of things that felt a little bit better," Summers, director of Obama's National Economic Council, said Thursday.
"The sense of a ball falling off a table, which is what the economy has felt like since the middle of last fall, I think we can be reasonably confident that that is going to end within the next few months, and we will no longer have that sense of a free-fall."
"We had some pretty dismal jobs numbers in Canada as unemployment rose to 8%, but that's been overshadowed by positive sentiment surrounding the financial sector," said Elvis Picardo, analyst and strategist at Global Securities in Vancouver. "Since the financial sector has been front and center in the midst of this turmoil, any improvement reflects positively on the rest of the economy and the rest of the equity markets."
• TSX +217.84 to 9,187.12 as financial issues got a lift from upbeat news from the U.S. banking sector and higher oil prices boosted energy shares.
• DOW +246.27
• Dollar +.80c to 81.62USD
• Oil +$2.86 to $52.24US per barrel.
• Gold -$2.60 to $882.50USD per ounce
• Canadian 5 yr bond yields +.04bps to 1.86 four weeks ago it was 1.90
• http://www.financialpost.com/markets/market_data/money-yields-can_us.html
Obama says U.S. economy beginning to show 'glimmers of hope'
Fri Apr 10, 3:37 PM Liz Sidoti, The Associated Press
WASHINGTON - U.S. President Barack Obama said Friday the economy is showing "glimmers of hope" despite continuing stresses, and he signalled more steps to brighten the business climate.
Obama commented to reporters after meeting at the White House with members of his economic team, including Treasury Secretary Timothy Geithner, economic adviser Larry Summers and Federal Reserve Chairman Ben Bernanke.
"What we're starting to see is glimmers of hope across the economy," the president said, although he also noted that the economy is "still under severe stress."
"Whatever we do ultimately has to translate into economic growth and jobs," Obama said.
He said there has been a significant uptick in the number of homeowners seeking to refinance their mortgages, which will put money back into their pockets. He said a 20-per-cent increase last month in the Small Business Administration's largest program means that small companies, often prized as the backbone of the economy, "are starting to get money."
But Obama also pointed to the high rate of joblessness - which climbed to a 25-year high of 8.5 per cent in March - and acknowledged that "we've still got a lot of work to do."
"We're starting to see progress," he declared, "and if we stick with it, if we don't flinch in the face of some difficulties, then I feel absolutely convinced that we are going to get this economy back on track."
Obama said he and his advisers discussed the stability of the financial system and a program to help banks clear their books of bad assets that have made normal lending difficult if not impossible.
Friday's meeting was Obama's first with his economic team since his return this week from an overseas trip partly focused on the global economic slump. He participated in a meeting in London of leaders from the 20 wealthiest and developing economies.
The backdrop for the meeting was the still-fragile economy that has begun to show hints of a possible recovery, including a strong profit forecast from Wells Fargo and Co., a drop in claims for unemployment benefits and predictions of solid April sales from several retailers.
Also promising were less jittery stock investors, shoppers and homebuyers, slowly thawing credit markets that were once frozen and stabilizing economic indicators that had been going from bad to worse.
All that has at least one Obama adviser sounding cautiously optimistic.
"There has been a substantial anecdotal flow over the last six to eight weeks of things that felt a little bit better," Summers, director of Obama's National Economic Council, said Thursday.
"The sense of a ball falling off a table, which is what the economy has felt like since the middle of last fall, I think we can be reasonably confident that that is going to end within the next few months, and we will no longer have that sense of a free-fall."
Thursday, April 9, 2009
Financial Update for April 9, 2009
• TSX +144.53 as oil prices rebounded and gave a boost to energy shares, while financials rose on news of U.S. aid for insurers.
• DOW +47.55
• Dollar +.03c to 80.82USD
• Oil +$.23 to $49.38US per barrel.
• Gold +$2.60 to $885.90USD per ounce
• Canadian 5 yr bond yields -.04bps to 1.82 four weeks ago it was 1.87
• http://www.financialpost.com/markets/market_data/money-yields-can_us.html
Housing starts post surprise jump Financial Post
OTTAWA - Home construction rose unexpectedly in March, led by Ontario and Quebec, Canada Mortgage and Housing Corporation said Wednesday.
There were 154,700 housing starts on an annualized basis during the month, up from a revised 136,100 units in February, the government agency said.
Many economists had expected housing starts to dip to 130,000 units in March.
"Higher multiple starts in Ontario and Quebec were the main contributors to the rise in new construction activity in March," said Bob Dugan, CMHC's chief economist.
"While the multiples segment experienced the largest increase, the overall boost in starts was broad based, encompassing the singles segment as well."
Urban housing starts were up 17% to 127,900 units in March, the agency said. Urban multiple starts rose 28.3% to 81,500 and urban single starts were 1.3% higher at 46,400.
Construction of urban units rose by an annualized 35% in Ontario and 23.3% in Quebec. Meanwhile, urban activity fell 17.3% in British Columbia, 7.9% in Atlantic Canada and by 7.5% in the Prairies.
Rural starts were flat at 26,800 units in March.
"New home construction is now at a more sustainable level after having been exceptionally strong over the past seven years, exceeding 200,000 units per year," CMHC said.
Millan Mulraine, economics strategist at TD Securities, said the report "suggests that new housing starts activity pickup aggressively in March after six consecutive monthly declines."
"However, in the grand scheme of things, the key economic fundamental factors continue to point to further weakness in Canadian housing sector activity, and as such we believe that this surprising pickup in construction activity is likely to be a one-month wonder, and expect activity to soften in the coming months," he said.
The CMHC report comes a day after TD Economic forecast average Canadian house prices to fall to about $246,000 in 2009 - down 24% from the peak of $324,000 in 2007 - while overbuilding in the residential market, particularly in the Prairies, should prevent the sector from making a quick recovery from the current downturn in sales, prices and construction.
"A glut in the housing stock means that builders will have to rein in residential construction further - particularly in the most overbuilt markets. As well, excess inventories in certain markets will prove an additional drag on home prices," it said.
The TD report said house prices have been overshooting their fundamental value by about 9% since 2005 as speculation drove up prices and encouraged overbuilding.
• DOW +47.55
• Dollar +.03c to 80.82USD
• Oil +$.23 to $49.38US per barrel.
• Gold +$2.60 to $885.90USD per ounce
• Canadian 5 yr bond yields -.04bps to 1.82 four weeks ago it was 1.87
• http://www.financialpost.com/markets/market_data/money-yields-can_us.html
Housing starts post surprise jump Financial Post
OTTAWA - Home construction rose unexpectedly in March, led by Ontario and Quebec, Canada Mortgage and Housing Corporation said Wednesday.
There were 154,700 housing starts on an annualized basis during the month, up from a revised 136,100 units in February, the government agency said.
Many economists had expected housing starts to dip to 130,000 units in March.
"Higher multiple starts in Ontario and Quebec were the main contributors to the rise in new construction activity in March," said Bob Dugan, CMHC's chief economist.
"While the multiples segment experienced the largest increase, the overall boost in starts was broad based, encompassing the singles segment as well."
Urban housing starts were up 17% to 127,900 units in March, the agency said. Urban multiple starts rose 28.3% to 81,500 and urban single starts were 1.3% higher at 46,400.
Construction of urban units rose by an annualized 35% in Ontario and 23.3% in Quebec. Meanwhile, urban activity fell 17.3% in British Columbia, 7.9% in Atlantic Canada and by 7.5% in the Prairies.
Rural starts were flat at 26,800 units in March.
"New home construction is now at a more sustainable level after having been exceptionally strong over the past seven years, exceeding 200,000 units per year," CMHC said.
Millan Mulraine, economics strategist at TD Securities, said the report "suggests that new housing starts activity pickup aggressively in March after six consecutive monthly declines."
"However, in the grand scheme of things, the key economic fundamental factors continue to point to further weakness in Canadian housing sector activity, and as such we believe that this surprising pickup in construction activity is likely to be a one-month wonder, and expect activity to soften in the coming months," he said.
The CMHC report comes a day after TD Economic forecast average Canadian house prices to fall to about $246,000 in 2009 - down 24% from the peak of $324,000 in 2007 - while overbuilding in the residential market, particularly in the Prairies, should prevent the sector from making a quick recovery from the current downturn in sales, prices and construction.
"A glut in the housing stock means that builders will have to rein in residential construction further - particularly in the most overbuilt markets. As well, excess inventories in certain markets will prove an additional drag on home prices," it said.
The TD report said house prices have been overshooting their fundamental value by about 9% since 2005 as speculation drove up prices and encouraged overbuilding.
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