These are stories Report on Business is following Wednesday, Aug. 21, 2013.
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Fed minutes on tap
The U.S. Federal Reserve releases the minutes of its latest meeting on Wednesday and a recent shift in market sentiment has traders closely watching for clues about when the U.S. central bank will start reeling in its massive bond-buying program.
At the open Wednesday, U.S. stock were lower. Shares in Europe closed down, although Japan's Nikkei had managed modest gains after the Bank of Japan suggested it would boost its own asset buying efforts if the economy takes a turn for the worst.
"There's been an element of caution in the markets this week, with traders clearing looking to the minutes as a potential risk to any upside moves," Craig Erlam, market analyst with Alpari U.K., said in a morning note. "The consensus in the markets has shifted in recent weeks towards tapering in September, rather than December, which makes these minutes even more important."
"I'm still of the opinion that the data doesn't justify tapering in September. If we do see any then I expect it to be minimal, maybe $10-$15-billion (U.S.), bringing purchases down to $70-billion, which wouldn't get the reaction in the markets that many would expect when tapering begins. It seems that the markets are pricing in $25-$30-billion of tapering at the moment, so even if we get an announcement in September, we could see further dollar weakness and gains in the U.S. indices."
The Dow Jones industrial average was down 44.46 points, or 0.30 per cent, at 14,958.53. The Standard & Poor's 500 Index was down 3.97 points, or 0.24 per cent, at 1,648.38. The Nasdaq Composite Index was down 0.26 points, or 0.01 percent, at 3,613.33.
The S&P/TSX composite index was down 68.14 points at 12,601.57 in late morning trading.
Asian stock markets traded unevenly. The benchmark Nikkei fell to as low as 13,250.36 but finished 0.2-per-cent higher at 13,424.33. The broader Topix dropped 0.3 per cent to 1,121.74 in light trade.
Despite the market's anticipation, at least some are convinced there's greater potential for a letdown when the Fed releases its minutes from its July policy statement at 2 p.m. EDT.
"By 7 p.m. this evening the financial markets may get a sense of how Arsenal fans are feeling at the moment when the contents of the latest minutes are published, and in all likelihood fail to shed any further light on what the Fed will do at its September meeting," Michael Hewson, senior market analyst at CMC Markets U.K., said in a note.
"The only thing that might prompt some price movement is if policy makers deviate in any way from the previous minutes and give more clarity about the timing and constitution of a possible tapering program , in terms of whether they taper the treasury purchases, or the mortgage backed security purchases."
With Reuters
Lowes also benefits from U.S. housing rebound.
A day after Home Depot Inc. posted results that beat the Street, competitor Lowes Cos. also clocked in with higher profit and sales, helped by a recovering U.S. housing market.
The No. 2 U.S. home renovation chain reported net income of $941-million (U.S.) or 88 cents a share in the latest quarter, up from $747-million or 64 cents a year earlier. The most recent quarterly results handily beat market forecasts, which had been calling for earnings per share of 79 cents in the most recent quarter.
Second-quarter sales rose 10.3 per cent.
Meanwhile, U.S. office supply giant Staples reported weaker earnings Wednesday, hit by a slower sales in international markets
Net income fell to $102.5-million, or 16 cents a share in the second quarter ended on Aug. 3 from $120.4-million, or 18 cents a share, a year earlier. Analysts had been expecting earnings of 18 cents in latest quarter. Staples shares were down about 10 per cent in premarket trading.
Read the full story here: Like Home Depot, Lowe's reults benefit from housing rebound, Staples profit falls on international weakness
Canadians want even wireless playing field
The Globe's Bill Curry reports that an even playing field for wireless companies is tantamount for Canadians:
A new survey commissioned by Bell and Telus suggests Canadians don't want Ottawa to give special treatment to foreign competitors.
The Nanos Research telephone survey of 2,000 Canadians found that 81 per cent of Canadians preferred that neither foreign, nor Canadian-owned telecommunications companies are favoured when Ottawa conducts an auction of highly-coveted wireless spectrum in January. The survey results are sure to be used by Canada's major telecommunications companies in their high-profile public relations campaign against Ottawa's plans to reserve half of the auctioned radio waves for foreign competitors.
Read the full story here: Canadians want an even playing field for wireless companies, poll says
Cold Stone bought
The Globe's Grant Robertson reports that a group of entrerpreneurs has bought Cold Stone Creamery and has big plans for the business:
U.S. ice cream company Cold Stone Creamery has been acquired by a group of Canadian entrepreneurs with ambitious plans to double the number of locations with partner Tim Hortons Inc.
The Markham, Ont.-based Serruya family bought a controlling interest in Cold Stone's parent company in an auction. The deal includes a number of fast-food chains, but Cold Stone is the company's most lucrative asset, owing to its highly visible partnership with the coffee and doughnut chain, with which it shares space at more than 250 stores across Canada and the United States.
Read the full story here: Canada's first family of freeze buys Cold Stone
Loblaw bid for Shoppers before
Retailing reporter Marina Strauss reports Loblaw Cos. Inc. made an earlier offer for Shoppers Drug Mart Corp. before the most recent deal:
Loblaw Cos. Ltd. , which is offering $61.54 a share to buy Shoppers Drug Mart Corp. , initially bid much less – $45 a share – for the drugstore chain in early 2011.
Loblaw increased the bid to $48 a share a few months later, but talks fell apart in June of that year partly because of the grocer's concerns about the effects of generic drug reforms, which have eaten into drugstores' profits and forced them to cut costs and shift strategies.
Read the full story here: Loblaw made bid for Shoppers in 2011
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