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☆ Shares steady on June hike hiatus hopes
▼ + stars: | 2023-06-05 | by ( Lawrence White | ) www.reuters.com time to read: +4 min

Japan's Nikkei (.N225) had earlier surged 2.1% to stand above 32,000 for the first time since July 1990. "With Saudi Arabia protecting oil prices from sliding too low ... we think oil markets are now more prone to a shortfall later this year," said Vivek Dhar, a mining and energy commodities strategist at Commonwealth Bank of Australia. The greenback also rose 0.1% on the Japanese yen to 140.26 while the euro eased 0.1% to $0.1069. Markets see a sizeable chance - about 40% - that the RBA could surprise with a quarter-point hike on Tuesday, after a minimum wage hike that economists feared could further stoke inflationary pressures. Additional reporting by Stella Qiu, Editing by Sam Holmes, Kim Coghill, Ed Osmond and Chizu NomiyamaOur Standards: The Thomson Reuters Trust Principles.

Persons: Issei Kato, Brent, Vivek Dhar, Fitch, Stella Qiu, Sam Holmes, Kim Coghill, Ed Osmond, Chizu Organizations: Nikkei, REUTERS, LONDON, Federal Reserve, Saudi, Japan's Nikkei, Nasdaq, Commonwealth Bank of Australia, Treasury, AAA, U.S, Bank of Canada, Reuters, BOC, Thomson Locations: Tokyo, Japan, Saudi Arabia, Asia, Pacific, China, U.S, United States, Australia, Canada

☆ Asian shares extend global rally
▼ + stars: | 2023-06-05 | by ( Stella Qiu | ) www.reuters.com time to read: +3 min

Brent oil rose 1% to $76.89 a barrel, giving up some of its earlier gains to as high as $78.73, while U.S. crude climbed 1.2% to $72.61 a barrel, after hitting a session high of $75.06. Oil prices have recently come under pressure amid heightened concerns about China's slowing economic recovery. "With Saudi Arabia protecting oil prices from sliding too low ... we think oil markets are now more prone to a shortfall later this year," said Vivek Dhar, a mining and energy commodities strategist at Commonwealth Bank of Australia. S&P 500 futures dipped 0.1% and Nasdaq futures dropped 0.3% in Asian hours, after a strong rally on Friday, driven by a mixed U.S. jobs report, a resolution to the debt-ceiling issue and the prospect of a U.S. rate pause this month. The U.S. dollar remained elevated on Monday at 104.14 against its major peers, after gaining 0.5% on Friday on the jobs report.

Persons: Brent, Vivek Dhar, Hong, Fitch, Himani Sarkar, Sam Holmes Organizations: Nikkei, Saudi, Commonwealth Bank of Australia, bbl, Japan's Nikkei, Nasdaq, Treasury, AAA, U.S, Bank of Canada, Reuters, BOC, Thomson Locations: SYDNEY, U.S, Saudi Arabia, OPEC, China, Asia, Pacific, Japan, United States, Australia, Canada

☆ Analysis: Strong economy puts Bank of Canada's 4-month rate hike pause in doubt
▼ + stars: | 2023-06-05 | by ( Steve Scherer | ) www.reuters.com time to read: +4 min

Inflation, which peaked at 8.1% last year, accelerated for the first time in 10 months in April to 4.4%, more than double the Bank of Canada's 2% target. The recent recovery in Canada's housing market is also putting pressure on prices, analysts say. "The Bank of Canada's penchant for surprising traders means that nothing can be ruled out," said Royce Mendes, head of macro strategy at Desjardins Group. Mendes said there could be more than one rate hike in the cards, and Canadians should "brace themselves for a further tightening in financial conditions this summer". "The latest round of data adds weight to our view that the Bank will need to conduct an insurance rate hike at either of its next two meetings," said Jay Zhao-Murray, FX analyst at Monex Canada.

Persons: Stephen Brown, Royce Mendes, Mendes, Macklem, Jay Zhao, Murray, Steve Scherer, Fergal Smith, Denny Thomas, Daniel Wallis Organizations: OTTAWA, Bank of Canada, BoC, Bank of Canada's, North, Capital Economics, Reuters, Federal Reserve, Desjardins Group, Monex Canada, Thomson Locations: North America, United States, States

While a federal election is not due until 2025, housing affordability is among the top concerns for Canadians who have grappled with supply shortages. The Liberal Party government's ambitious plan to welcome 500,000 immigrants per year by 2025, or about 1.25% of its population, is expected to fuel robust demand for housing. In April 2022, the Liberal government announced plans to double housing construction over the next decade. It's been 8 years (since he took power), and now, housing costs have doubled," Poilievre said on Twitter earlier this month. Speaking with the heads of Canada's municipalities last week, Trudeau said the government's next "long term infrastructure" plan will be revealed this autumn.

Persons: Justin Trudeau, Randall Bartlett, Bartlett, Pierre Poilievre, Trudeau, Poilievre, Darrell Bricker, they're, Bricker, James Laird, Laird, Fergal Smith, Steve Scherer, Marguerita Choy Organizations: TORONTO, Bank of Canada, Liberal Party, Desjardins, Liberal, Housing, Canada Mortgage, Housing Corporation, Canadian Home Builders ' Association, Reuters, Conservative Party, Twitter, Toronto Area, Public Affairs, Thomson Locations: Toronto, Ottawa

☆ Canceled TV deal cuts one loan cord
▼ + stars: | 2023-05-23 | by ( ) www.reuters.com time to read: +2 min

NEW YORK, May 23 (Reuters Breakingviews) - Banks can tune out one painful summer rerun. Television broadcaster Tegna (TGNA.N) on Tuesday terminated its sale to hedge fund Standard General, letting banks off the hook for $8.2 billion in debt backing the deal. As a result, Standard General couldn’t finance its transaction. Chipping away at the $25 billion-plus pile of hung loans potentially frees banks up to start fresh. They do not reflect the views of Reuters News, which, under the Trust Principles, is committed to integrity, independence, and freedom from bias.

☆ Canadian banks see earnings risk from commercial property loans, TD in focus
▼ + stars: | 2023-05-22 | by ( Nivedita Balu | ) www.reuters.com time to read: +4 min

TORONTO, May 22 (Reuters) - Canadian banks are expected to report a rise in bad debt provisions and highlight risks from commercial property loans when they report earnings this week, with the country's No.2 bank TD (TD.TO) in focus after its acquisition of First Horizon (FHN.N) failed. Bay Street analysts have lowered their second quarter earnings expectations for Canadian banks, anticipating higher expenses and slowing loan growth as turmoil south of the border weighs on the broader banking sector. Still, investors view Canadian banks as safer bets than their U.S. counterparts due to their strong capital levels. BMO and Scotia Bank (BNS.TO) are due to report earnings on Wednesday, while TD, Canadian Imperial Bank of Commerce (CM.TO) and Royal Bank of Canada (RY.TO) report on Thursday. Canadian bank stocks have largely underperformed TSX Canadian bank stocks have largely underperformed TSXEmpty offices in big cities have raised concerns among investors about banks' commercial property loan exposure, since about 10% of the lending portfolio of the Big-6 banks is tied to commercial real estate.

☆ BoC's Macklem says it's far too early to think about interest rate cuts
▼ + stars: | 2023-05-19 | by ( ) www.reuters.com time to read: +1 min

SAO PAULO, May 19 (Reuters) - Bank of Canada Governor Tiff Macklem reiterated on Friday it is far too early to be thinking about interest rate cuts, adding that he expects the consumer price index to decline to around 3% this summer and back to the bank's 2% inflation target around the end of 2024. Macklem told a seminar hosted by Brazil's central bank that the Canadian monetary authority has been using a pause in interest rate increases to assess whether policy has been tightened enough to get inflation back to 2%. Canada last hiked rates in January, holding its benchmark rate at 4.5% since then, despite saying it would be ready to hike again if inflation risks remain significantly above target. "So far, Canadians are proving resilient," the central bank governor said, pointing out that delinquencies on mortgages remain low. Reporting by Gabriel Araujo; editing by Jonathan OatisOur Standards: The Thomson Reuters Trust Principles.

☆ BoC's Macklem says it's far too early to think about interest rates
▼ + stars: | 2023-05-19 | by ( ) www.reuters.com time to read: 1 min

April's unexpected acceleration in inflation to 4.4% from 4.3% in March has some economists forecasting a hike later this year. "Inflation has come down. We expect it will continue to come down," Macklem said when asked about the inflation figures published this week. He did, however, acknowledge that April inflation "did come in stronger than we expected." "While most households are proving resilient to increases in debt-servicing costs, early signs of financial stress are emerging," particularly among recent home buyers, according to the so-called Financial System Review.

☆ Canada's annual inflation rate unexpectedly speeds up to 4.4% in April
▼ + stars: | 2023-05-16 | by ( ) www.reuters.com time to read: +2 min

OTTAWA, May 16 (Reuters) - Canada's annual inflation rate surprisingly ticked up to 4.4% in April, as higher shelter costs contributed to the first acceleration in the consumer price index in 10 months, Statistics Canada data showed on Tuesday. Analysts polled by Reuters had expected the annual inflation rate to edge down to 4.1% from 4.3% in March. Higher rent and mortgage interest costs contributed the most to the annual inflation rate in April, Statscan said. The higher interest rate environment may have contributed to rising rents in April by stimulating higher rental demand, the agency said. The month-over-month inflation rate was driven by gasoline prices, which posted the largest monthly increase since October, following an announcement from OPEC+ to cut oil output, Statscan said.

☆ TSX tumbles after hotter-than-expected inflation data
▼ + stars: | 2023-05-16 | by ( Johann M Cherian | ) www.reuters.com time to read: +2 min

A report by Statistics Canada showed that April annual consumer inflation had surprisingly ticked up, fueled by higher rental and mortgage interest costs. "Underlying core inflation is settling in around 4%, which is clearly still too high for the BoC's comfort." ET (14:14 GMT), the Toronto Stock Exchange's S&P/TSX composite index (.GSPTSE) was down 235.32 points, or 1.15%, at 20,304.65. The materials sector (.GSPTTMT) tumbled 1.4% and was the biggest drag on the TSX, tracking weak base- and precious-metal prices. Reporting by Johann M Cherian and Vansh Agarwal in Bengaluru; Editing by Pooja DesaiOur Standards: The Thomson Reuters Trust Principles.

OTTAWA, May 16 (Reuters) - Canada's annual inflation rate rose in April for the first time in 10 months, data showed on Tuesday, adding pressure on the central bank to raise interest rates again after having paused its tightening campaign since January. Annual inflation unexpectedly rose to 4.4% in April, Statistics Canada said. Higher rent and mortgage interest costs contributed the most to the annual inflation rate in April, Statscan said. The higher interest rate environment may have contributed to rising rents by stimulating higher rental demand, the agency said. Excluding food and energy, prices rose 4.4% compared with a rise of 4.5% in March.

☆ Canada housing market upturn could delay shift to BoC rate cuts
▼ + stars: | 2023-05-14 | by ( Fergal Smith | ) www.reuters.com time to read: +3 min

The housing market's upturn comes after the Bank of Canada paused its interest rate hiking campaign last month, leaving the benchmark rate at a 15-year high of 4.50% since January. A rebound in the housing market could boost activity and contribute directly to price pressures. "The Bank of Canada at the end of the day is probably not going to be too thrilled if the housing market really starts to ramp up," said Robert Kavcic, a senior economist at BMO Capital Markets. In addition, variable-rate borrowers have been sheltered from higher interest rates after lenders temporarily extended the period over which their debt is amortized, keeping their payments the same. But there are also tailwinds to support a recovery, including supply shortfalls, record immigration and labor market strength, analysts said.

☆ Aramco’s dividend largesse contains a hard logic
▼ + stars: | 2023-05-09 | by ( ) www.reuters.com time to read: +2 min

That could work out to up to $18 billion a year, Royal Bank of Canada analysts reckon. Given that there are solid long-term reasons to hold Aramco shares, it might seem odd that the world’s largest oil producer feels the need to keep its investors on side. Meanwhile, Aramco’s dividend has been fixed since its listing, but that arrangement expires next year. Flagging to prospective foreign investors that its dividend policy is not entirely dependent on the whims of the Saudi state is probably not a bad idea. They do not reflect the views of Reuters News, which, under the Trust Principles, is committed to integrity, independence, and freedom from bias.

☆ Bank of England set to raise rates to 4.5% next week, a possible peak
▼ + stars: | 2023-05-05 | by ( David Milliken | ) www.reuters.com time to read: +5 min

Economists polled by Reuters this week were unanimous that the BoE's Monetary Policy Committee (MPC) will raise rates to 4.5% next week, in sharp contrast to a poll two weeks earlier which showed only a slim majority expecting a hike. "Previously we had seen the MPC holding Bank Rate at 4.25% but the April labour market and March CPI inflation data were too much to ignore," said Peter Schaffrik, global macro strategist at Royal Bank of Canada. Only a minority of economists polled by Reuters this week expect the BoE to raise interest rates above 4.5% this year. But investors in interest rate futures - whose views shift more rapidly - see rates reaching 4.75% or 5% by September. "In our view, further tightening beyond May can't be ruled out," said Andrew Goodwin, chief UK economist at Oxford Economics.

LONDON, May 4 (Reuters) - U.S. private equity firm Summit Partners is looking to sell a stake in Swiss wealth manager Cinerius Financial Partners amid increasing consolidation in the sector, two people familiar with the matter told Reuters. Summit intends to bring in another private equity fund to help fund Cinerius' growth, particularly through acquisitions, one of the people said. Asset manager BlackRock Inc (BLK.N) provides debt financing for Cinerius' acquisitions through its private credit arm, the person added. BlackRock, Cinerius and Summit Partners did not respond to requests for comment. Belgian private bank Degroof Petercam is reviewing strategic options after drawing interest from rivals, Reuters reported last Friday.

☆ Toronto home prices rise for third month in April
▼ + stars: | 2023-05-03 | by ( Fergal Smith | ) www.reuters.com time to read: +1 min

[1/2] A for sale sign is displayed outside a home in Toronto, Ontario in Toronto, Ontario, Canada December 13, 2021. The average price of a GTA home rose to C$1.153 million ($846,425) in April, up 4% from March, Toronto Regional Real Estate Board (TRREB) data showed on Wednesday. On a year-over-year basis, the average price remained lower, but the pace of decline slowed to 7.8% from 14.6% in March. The average price was 13.6% below the February 2022 peak. "Many buyers have come to terms with higher borrowing costs and are taking advantage of lower selling prices compared to this time last year," TRREB President Paul Baron said in a statement.

Royal Bank of Canada analysts said the results pointed to a strong performance at BNP's trading arm and good cost control. In securities trading, revenue edged down 1.8% but still performed better than some peers including Deutsche Bank (DBKGn.DE), which saw fixed-income trading decline by 17% in the first quarter. At U.S. bank Goldman Sachs, first-quarter sales from fixed income, currency and commodities (FICC) trading, usually a bright spot, plunged 17% to $3.93 billion, while equity trading revenue sank 7% to $3.02 billion. The first quarter net income, group share amounted to 4.44 billion euros, in line with expectations, and up from 1.84 billion a year earlier. The first tranche of 2.5 billion euros was approved in March, a sign analysts deemed reassuring as it took place shortly after the collapse of Credit Suisse.

☆ Bank of Canada rate-cut bets recede as core inflation proves sticky
▼ + stars: | 2023-04-26 | by ( Fergal Smith | ) www.reuters.com time to read: +3 min

[1/2] A sign is pictured outside the Bank of Canada building in Ottawa, Ontario, Canada, May 23, 2017. The BoC has made greater progress in slowing inflation than some major peers, including the Federal Reserve and European Central Bank. Still, the rise in inflation expectations could be another reason for the Canadian central bank to be cautious about easing rates. The central bank has left its benchmark interest rate on hold for two straight meetings after lifting it to a 15-year high of 4.50%. Those rate hikes have contributed to inflation, by driving up mortgage borrowing costs, but the main aim is to slow the economy.

☆ Morning Bid: Cloud control - tech trumps banks
▼ + stars: | 2023-04-26 | by ( ) www.reuters.com time to read: +5 min

Alphabet (GOOGL.O) also gained 1% as it too trumpeted gains in cloud services and AI, alongside plans for a $70 billion buyback. With Meta (META.O) results out later, its stock was up 2% and Amazon (AMZN.O) raced ahead 4%. PacWest Bancorp's (PACW.O) shares jumped 15% in extended trading after the regional lender said deposits have been building recently. And in Europe, Standard Chartered (STAN.L) shares bucked otherwise dour markets on a forecast-beating 21% jump in first-quarter profits. U.S. Treasury markets continued to rally, with yields on 2-year notes dropping below 4% Tuesday and testing 3.9% early today.

☆ Morning Bid: Oil price relapse
▼ + stars: | 2023-04-20 | by ( ) www.reuters.com time to read: +4 min

Although oil prices have not yet reversed all their gains from OPEC move, Brent is down more than 5% over the past week and the year-on-year deflation in oil prices is running at 24%. And there's also signs oil loading from Russia's western ports this month is rising to the highest since 2019 -= despite Moscow's pledge to cut output. Tesla (TSLA.O) shares dropped 2% after the electric-vehicle maker's sixth U.S. price cut this year. Helped by the oil price retreat, 2-year U.S. Treasury yields fell back almost 10 basis points to 4.19%. VIX and bear marketsShare price performance, earnings and sales for TeslaReuters GraphicsReuters GraphicsBy Mike Dolan, <a href="mailto:mike.dolan@thomsonreuters.com" target="_blank">mike.dolan@thomsonreuters.com</a>.

☆ Higher US Fed rates 'not a major concern' for C$, BOC's Macklem says
▼ + stars: | 2023-04-20 | by ( ) www.reuters.com time to read: 1 min

OTTAWA, April 20 (Reuters) - The impact on the Canadian dollar from U.S. Federal Reserve raising interest rates more than the Bank of Canada is not a "major concern" because of a flexible exchange rate and the BOC's independent monetary policy, Governor Tiff Macklem said on Thursday. "That is not a major concern. We have an independent monetary policy, we have a flexible exchange rate," Macklem told a Canadian Senate panel, in response to a question about the impact of higher U.S. interest rates on the Canadian dollar. "For sure there'll be some fluctuations in the Canadian dollar .. but, by and large, the flexible exchange rate system works pretty well," he said. Reporting by Ismail Shakil and Steve Scherer in OttawaOur Standards: The Thomson Reuters Trust Principles.

☆ Short positions on Canada's TD Bank rise to $6.1 billion, ORTEX data shows
▼ + stars: | 2023-04-19 | by ( Maiya Keidan | ) www.reuters.com time to read: +2 min

TORONTO, April 19 (Reuters) - Hedge fund bets against Canada's TD Bank Group (TD.TO) hit $6.1 billion on Wednesday, a 45% increase from 14 days ago, according to data provider ORTEX's calculations, one day ahead of the Canadian lender's annual general meeting. So-called 'arbitrage investors', many of which are event-driven hedge funds, bet on mergers and acquisitions by buying shares of the target and shorting the acquirer's stock. TD, which is awaiting regulatory approval of its takeover of First Horizon, is expected to address the $13.4 billion deal at its AGM on Thursday in Toronto. Hedge funds profit when they borrow a stock from an institutional investor and sell it back when the price falls, pocketing the difference, a practice known as short-selling. TD shares are down 0.1% since the U.S. regional banking crisis began, and up 3.4% this week.

☆ Canada Government Workers Strike Over Pay to Offset Inflation
▼ + stars: | 2023-04-19 | by ( Paul Vieira | ) www.wsj.com time to read: 1 min

Bank of Canada Gov. Tiff Macklem told lawmakers this week that annual wage growth needs to slow from its current level. Photo: David Kawai/Bloomberg NewsOTTAWA—About 150,000 Canadian government workers went on strike early Wednesday, in a dispute over wage increases that could have implications on efforts by the country’s central bank to sharply slow inflation. The Public Service Alliance of Canada is seeking wage gains of 13.5% over a three-year period, or roughly 4.5% a year. Union leadership said this would help offset the sharp acceleration in inflation in Canada and the rest of the developed world since the initial wave of the Covid-19 pandemic, due to a combination of supply-chain constraints, stronger-than-expected consumer demand, and the war in Ukraine’s impact on commodity prices.

☆ Canadian housing starts slow as BoC rate hikes weigh
▼ + stars: | 2023-04-19 | by ( Fergal Smith | ) www.reuters.com time to read: +1 min

TORONTO, April 19 (Reuters) - Canadian housing starts fell more than expected in March, contributing to a slower trend in recent months that follows a rapid increase in borrowing costs, data from the national housing agency showed on Wednesday. The seasonally adjusted annualized rate (SAAR) of housing starts fell 11% to 213,865 units from a revised 240,927 units in February, the Canadian Mortgage and Housing Corporation (CMHC) said. "The SAAR of housing starts and the trend appear to be returning to pre-pandemic levels," Bob Dugan, CMHC's chief economist, said in a statement. The Bank of Canada has lifted its benchmark interest rate to a 15-year high of 4.50% to tackle inflation. For the first quarter, starts averaged 223,000, the weakest quarter since the depth of the COVID-19 pandemic in early-2020, Robert Kavcic, a senior economist at BMO Capital Markets, said in a note.

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