Canada’s exporters put some shine on this country’s economic growth in the second quarter as total annualized GDP surged 3.7 per cent. That was far above Bay Street’s expectations. But if you scrape below the surface, there’s some cause for concern. Non-residential business investment plunged 16 per cent and household spending slowed sharply. It’s a lot to take in – and the stakes are significant, with a Bank of Canada rate decision coming up next week.
GETTING INTO THE HOUSING MARKET
The federal government’s First-Time Home Buyer Incentive program will start accepting applications next week, opening the door for eligible new buyers to get a booster shot from the feds – which would chip in five per cent for an existing home, and up to 10 per cent for a new home. Eligibility is restricted to households with no more than $120,000 in annual income, meaning buyers in pricier cities might have to temper expectations for their first abode. Here’s a primer on BNNBloomberg.ca.
OSC SETTLES BIG BANK FX CLAIMS
Earlier this week we reported on the Ontario Securities Commission’s allegations about certain inappropriate behaviour among the FX teams at RBC and TD. This morning, the regulator signed off on settlements that will see RBC pay $13.5 million, while TD pays $9.3 million. Both banks will also cover $800,000 in OSC staff costs, and they’ve agreed to audit the compliance frameworks at their FX trading units.
IN CONVERSATION WITH UBER’S CEO
Dara Khosrowshahi talked up Uber Technologies’ “path to profitability” in an interview with our Bloomberg partner Emily Chang yesterday. He discussed the company’s nuts and bolts (including his view that “the category of food can be as large or even larger than the ride-sharing category”) and the competitive landscape. Watch for highlights this morning on BNN Bloomberg.
While Beijing pacified investors earlier this week, worth keeping in mind the next wave of China-U.S. tariffs take effect on Sunday. The list of Chinese exports being subjected to the new 10 per cent surtax as of Sept. 1 is here. U.S. President Donald Trump, meanwhile, said the two countries were planning “a talk [Thursday] at a different level.”
OTHER NOTABLE STORIES
-SNC-Lavalin today said the U.S. Department of Energy is extending a contract with a consortium including its Atkins Nuclear Secured Holdings unit. In total, the extension could be worth $725 million.
-DHX Media Founder Michael Donovan has stepped down as CEO of the Halifax-based kids’ content warehouse. He’s being replaced by Eric Ellenbogen, who previously held senior roles at Marvel and DreamWorks. DHX’s stock is down 27 per cent so far this year.
-CAE is partnering up with business jet conglomerate Directional Aviation Capital. The arrangement includes CAE paying US$85 million for a 50 per cent stake in a specialized simulator business. I see that at least one analyst subsequently upgraded CAE.
-The proposed multi-jurisdiction U.S. settlement with Oxycontin maker Purdue Pharma has reportedly hit a hurdle, with The Wall Street Journal reporting some state attorneys general are pushing back on the terms. Earlier reports suggested the settlement could be worth upward of US$12 billion.
-Tesla shares moved higher in pre-market trading after China’s industry ministry indicated the carmaker will be exempted from a tax on auto purchases.
-Apple has sent out invitations for a Sept. 10 product launch event in Cupertino at the Steve Jobs Theatre.
-Notable earnings: Campbell Soup
-Notable data: Canadian GDP, U.S. personal income and spending
-9:00 a.m. ET: OSC hearing re. proposed settlement with Toronto-Dominion Bank over FX activities
-10:00 a.m. ET: OSC hearing re. proposed settlement with RBC over FX activities
-11:00 a.m. ET: Prime Minister Justin Trudeau meets with Mayor Kennedy Stewart in Vancouver
-12:00 p.m. ET: Foreign Affairs Minister Chrystia Freeland announcement at University of Toronto
-2:00 p.m. ET: British Columbia Utilities Commission Chair David Morton holds news conference in Vancouver to release findings from inquiry into gasoline prices.
Every morning BNN Bloomberg’s Managing Editor Noah Zivitz writes a ‘chase note’ to BNN Bloomberg’s editorial staff listing the stories and events that will be in the spotlight that day. Have it delivered to your inbox before the trading day begins by heading to www.bnnbloomberg.ca/subscribe.