These are stories Report on Business is following Monday, July 1, 2013.
The Toronto market is closed today for the Canada Day holiday, but shares of Research In Motion Ltd. tumbled again on Nasdaq.
Shares of RIM, which has rebranded itself as BlackBerry but whose legal name remains Research In Motion for now, closed at $10.29 (U.S.), off 1.6 per cent.
That follows a rout on Friday, when the BlackBerry maker’s stock sank by almost 28 per cent after a disappointing first-quarter earnings report that included a hefty loss and signs of fewer-than-expected sales of its new BB10 models.
As The Globe and Mail’s Omar El Akkad reports, RIM posted a first-quarter loss of $84-million or 16 cents a share in the quarter, narrower than the loss of $518-million or 99 cents a year earlier.
Revenue climbed to $3.1-billion.
The quarter marked the first full look at how the new BB10 models are faring, and the report showed that to be below what analysts had expected.
RIM shipped a total 6.8 million smartphones in the quarter, about 2.7 million of them the new smartphones.
“A full quarter of BB10 sell-in should’ve resulted in better results,” said analyst Mark Sue of RBC Dominion Securities.
Barrick in spotlight
Shares of Barrick Gold Corp. also saw some U.S. action today after its announcement late Friday of a potentially big hit and a delay to a key project, with shares falling a further 3.1 per cent.
The Canadian miner said it expects a writedown of up to $5.5-billion (U.S.) on its Pascua-Lama project in South America, and expects its first production to be delayed by more than 18 months, The Globe and Mail’s Brent Jang reports.
The project is in the Andes, on the border between Chile and Argentina.
But, aside from a collapse in gold prices, it’s in Chile where the problems lie.
Chile has ordered Barrick to finish a water management system.
Mark Carney went to work today. But unlike other people, the world was watching.
Mr. Carney took the subway as he made his debut as governor of the Bank of England, The Globe and Mail’s Paul Waldie reports from London.
The Bank of England tweeted a picture of his arrival, and a BBC crew filmed him as he was briefed.
The former Bank of Canada governor has gained what can only be seen as rock star status where monetary and economic policy is concerned.
He has been called everything from the Wayne Gretzky to the George Clooney of central banking. There’s a new one today, with a comparison to Cary Grant.
“The arrival of Mark Carney from Canada to replace the outgoing Mervyn King as governor of the Bank of England is finally upon us and given the hype surrounding his arrival the potential for disappointment has to be fairly high,” said senior analyst Michael Hewson of CMC Markets in London.
“Never has so much been expected from someone not elected to public office and the new governor's mandate is quite wide-ranging given the new powers granted to the Bank of England as the new regulator of financial services in the U.K.”
Much is riding on his tenure in London, for which he left his Canadian appointment early, though fresh data today suggest the British economy is picking up.
“Lauded as the best central banker of his time by George Osborne, Mr. Carney will be only too aware that there will be immense scrutiny on his role, and his relationship with the Treasury and the U.K. government,” Mr. Hewson said, referring to the country’s finance minister.
“He needs to be seen to be his own man and to reinforce the point which he himself made recently that central banks should be no substitute for political and structural reform and for that reason alone Carney could well see his relationship with the Chancellor come under strain.”
- First day on the job, Carney prepares to stir up Bank of England
- ‘Mark has been kind of preparing for this his whole life’
Young and jobless in Europe
Europe continues to reel from crippling levels of unemployment, particularly the region’s young people.
The jobless rate in the embattled euro zone climbed in May to 12.1 per cent, from a revised 12 per cent in April.
In the wider European Union, unemployment among the 27 member nations held steady at 10.9 per cent.
Almost 26.5 million people are jobless across the EU, more than 19 million of them in the 17-member euro zone, which has been smacked by a debt crisis that followed the recession.
In the weaker states of the monetary union, unemployment is intolerable. Spain, for example, is suffering a jobless rate of 26.9 per cent, and Greece 26.8 per cent.
The region’s young people are suffering to the point where the term “lost generation” is no longer just a fear.
More than 5.5 million young people can’t find work in the EU, 3.5 million of them in the euro zone. In percentage terms, the youth jobless rate now stands at 23 per cent in the EU and 23.8 per cent in the currency union.
But that masks the severity of some of the individual countries, such as the 59.2 per cent in Greece, the 56.5 per cent in Spain and the 42.1 per cent in Portugal.