A roundup of what The Globe and Mail’s market strategist Scott Barlow is reading today on the Web
Canadian and U.S. employment numbers crossed the wires at 8:30 a.m. Friday. The domestic economy created 31,800 jobs when 20,000 were expected. In the U.S., 213,000 new jobs were reported versus consensus expectations of 195,000.
BMO notes that oil prices are heading to C$100 per barrel, creating a potential windfall for the domestic oil patch,
“The combination of strong oil prices and a weak Canadian dollar is noteworthy in that oil prices in Canadian-dollar terms are now pushing near $100/bbl [barrel], almost back to levels seen before prices collapsed in 2014. If this trend holds, there is substantial revenue upside for Canada’s oil-producing provinces in FY18/19.”
“@SBarlow_ROB BMO notes crude prices near 2014 level in CAD terms” – Twitter
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Also from BMO economists in a separate report, they indicate that China/U.S. trade wars won’t have a huge effect unless it gets a lot worse,
“U.S. equity futures are down about 0.1 per cent, as U.S./China tariffs came into effect overnight. Asian markets shrugged off the news, while European markets are little changed. It will take time before we see the impact of the tariffs but as long as the ‘trade war’ doesn’t worsen, the hit to growth will be minimal. However, that would change if Trump follows through on this threat to tariff hundreds of billions in Chinese imports.”
Global markets weren’t overly concerned as tariffs were enacted. Asian markets rallied immediately and the U.K. equity benchmark is in positive territory at time of writing.
“@SBarlow_ROB Also BMO: ‘It will take time before we see the impact of the tariffs but as long as the ‘trade war’ doesn’t worsen, the hit to growth will be minimal.’ ” – (research excerpt) Twitter
“The U.S. vs. everyone: Why the global trade fight just got nastier” – Report on Business
“The collapse in copper deepens after Donald Trump escalates his trade war with China” – Bloomberg
“What if … Trump’s not bluffing, trade is crippled, Canada sinks into recession, markets are roiled, you pay more” – Babad, Report on Business
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The Economist is following Canadian marijuana companies’ plot for world domination,
“The biggest banks, without whom nothing substantial is financed in Canada, have been wary. That changed on June 26th when the Bank of Montreal agreed to loan Aurora Cannabis up to C$200-million (US$147-million), with the possibility of an additional C$45-million following legalization. The funds will allow the Alberta firm to keep pushing in its quest to have ‘boots on the ground in countries across the world,’ Terry Booth, its boss, told Bloomberg, a news provider. European demand for medical cannabis is much stronger than anticipated, he says, citing Germany, Denmark, Italy, Poland and Malta as particularly hot markets.”
“Canada’s cannabis firms plot world domination” – The Economist
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Tweet of the Day: “@patrickrooney ‘Top 5 Technical Analysis Mistakes Beginners Make’ by @CryptoCred medium.com/@cryptocreddy/… “ – Twitter
Diversion: “The Smashing Pumpkins played a house party. Of course, someone called the cops.” – Journal of Musical Things
Scott Barlow