These are stories Report on Business is following Thursday, April 30, 2015.
Greek talks heat up
Greece is scrambling today to end a stalemate with its lenders and head off what some observers warn could be bankruptcy.
According to several reports, negotiators for the government and its various creditors have stepped up talks with the goal of reaching a deal by Sunday.
Greece's new government, which recently overhauled its bargaining team, faces a mid-May payment of some €750-million to the International Monetary Fund.
Prime Minister Alexis Tsipras, recently elected on an anti-austerity platform, is pushing for an agreement, so much so that he recently removed his finance minister, Yanis Varoufakis, from an aggressive role in the talks.
Greece's lenders are looking for a package of hard and fast reforms where pensions, taxes and the labour market are concerned, and Athens appears to be trying to meet some of the goals.
"The Greek government is ready for an honest solution which will unlock financial aid from partners and put an end to the economic asphyxiation the bailouts have caused," Mr. Varoufakis reportedly told a radio interviewer.
Of course, we've been here before many times since the Greek debt crisis erupted years ago.
"Greece is still grabbing traders' attention, and Athens has softened its negotiating teams by taking Yanis Varoufakis off the front line, but the nation still has a noose around its neck in terms of its debt levels," said market analyst David Madden of IG in London.
"Greece still has to hammer out a deal with creditors over reforms in order to receive the next round of financing, which will then be used to make repayments," Mr. Madden added today.
"Greece has been trapped in a merry-go-round of crisis talks and last-minute repayments for several years and there is no sign of it getting off soon."
The Greek crisis has been rippling through financial markets off and on over the years.
And today, the euro gained some ground "on what seems to be an added oomph" in the negotiations, said senior economist Jennifer Lee of BMO Nesbitt Burns, though it later pulled back.
"The 'new and improved' list of reforms was presented to its creditors yesterday (and FM Varoufakis reiterated that pension reform is still off the table) and, in addition to the list, the Greek government is considering selling 51-per-cent stakes in its two ports (Piraeus and Thessaloniki," Ms. Lee said.
"There are hopes that a deal could be reached this weekend but we've been down this road before."
- Tsipras presses for May debt deal, says referendum possible
- Greece clips Varoufakis's wings as it reorganizes bailout team
- Eric Reguly: Blame Germany for Greece's uphill euro zone struggle
- Wife shields Greek Finance Minister from anarchist attack
Canada's economy stalled out in February, while January is now reported to be a shade worse and December a bit better.
Gross domestic product was flat in February, Statistics Canada said today, which was actually a better showing than economists had expected.
But, as The Globe and Mail's David Parkinson reports, January's showing was revised to show the economy contracted by 0.2 per cent while December's reading was moved up to show growth of 0.4 per cent.
Service industries perked up in February, as did the retail, finance and insurance sectors.
Goods production, however, slipped.
When it comes right down to it, this is rearview-mirror stuff.
The Bank of Canada, and many economists, have already written off the first quarter of the year, hoping for a pickup going forward.
"That lift in February will create a drag in March, but the negatives from manufacturing and wholesaling were most likely influenced by the unseasonably cold weather and weakness in the U.S., which we see dissipating in upcoming releases," said Nick Exarhos of CIBC World Markets.
"Unfortunately, today's release also downgraded January's monthly GDP output to a -0.2-per-cent outcome, a tick weaker than previously reported," he added.
"That means that Q1 is likely to, at best, track a 0.5-per-cent growth pace, just above the Bank of Canada's expectations for a flat reading."
- David Parkinson: Canada's economy stalls in February
- David Parkinson: Canadians should cross their fingers for a U.S. resurgence
Shares of Potash Corp. of Saskatchewan slipped today after the agriculture giant slashed its outlook.
Potash Corp. profit rose in the first quarter of the year to $370-million (U.S.), or 44 cents a share, diluted, from $340-million, or 40 cents a year earlier.
With today's report, however, came a new forecast for the year.
Potash Corp. now expects earnings per share of 45 cents to 55 cents in the second quarter of this year, and $1.75 to $2.05 for all of 2015.
It blamed higher provincial taxes, lower nitrogen sales and prices, and a shift in potash sales, among other things.
"We adjust our full-year guidance largely on higher Saskatchewan potash taxes and first-quarter performance that trailed our initial expectations," chief executive officer Jochen Tilk said in a statement.
"Looking ahead, we are encouraged by the strength in global potash demand and see momentum accelerating through the second quarter, especially in offshore markets."
Earnings parade rolls on
Canadian corporate earnings are rolling in, following on the heels of their American cousins.
Among the Canadian and U.S. companies reporting today:
- BCE profit beats estimates on customer additions
- Leaner Maple Leaf Foods starts to see light after dark times
- Penn West's loss widens as prices, output fall
- Imperial Oil first-quarter earnings fall by half on oil price
- Exxon quarterly profit falls 46 per cent
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