No surprise here: The slowdown in Canada’s largest housing market continued last month as rising interest rates dampened demand. Sales in the Greater Toronto Area fell nearly 11% in September and 44% from a year earlier, according to the Toronto Regional Real Estate Board. The average sale price was little changed at $1,086,762 (though down almost 19% from the February high), and the local real estate board sounded the alarm about new listings setting a low of 20 for the month of September (although it should be pointed out there was more inventory than in August). We will speak with the President of TRREB shortly after 8 a.m. EDT.
And if you missed it, check out Jacqueline’s interview with CIBC’s Benjamin Tal, who lambasted governments for not coordinating their efforts to solve what he called a “major national crisis” over affordability.
OPEC+ DECISION DAY
As of 6:30 a.m. EDT, it looked like this could be a rumored buy/news sell situation as West Texas Intermediate and Brent futures were flat ahead of today’s cartel decision. and its allies. Yesterday’s statements from unidentified sources got the market thinking about the possibility that production quotas could be reduced by up to 2 million barrels per day. So we have to ask ourselves what will happen if the oil producing nations do not take this into account.
Futures suggest major North American markets will open lower after a two-day rally that saw the S&P 500 jump 5.7%, while the S&P/TSX Composite Index was not too far off behind. The next big opportunity for market participants to weigh the chances of a break or pivot from major central banks will come on Friday, with the release of jobs data from the United States and Canada.
HSBC CANADA CONTEST
Another Bay Street analyst assesses potential suitors for HSBC’s Canadian operations after yesterday’s announcement that the division could be up for grabs; and this one landed on the National Bank of Canada as the most logical buyer. In a note to clients last night, Mike Rizvanovic of Keefe Bruyette & Woods said National may have “the most compelling reason” to buy HSBC Canada. We will have more details on his justification on television and on BNNBloomberg.ca
IF AT FIRST YOU DON’T SUCCEED, TRY, TRY, TRY AGAIN…
If nothing else, Dye & Durham is persistent. Just weeks away from the collapse of its long bid to buy Link Administrations Holdings, the Toronto-based software consolidator is now trying to buy some of its parts. Link disclosed in a market filing this morning that Dye was offering to buy its corporate markets and banking and credit management operations for A$1.27 billion.
THE MARKET STILL SKEPTIC ON THE BUYBACK OF TWITTER
At least that’s the inference that can be made from the spread between yesterday’s Twitter stock close ($52.00) and Elon Musk’s phoenix bid of $54.20. Beyond the legal battle Musk wants to avoid, there’s also the question of whether to get proceeds from any debt financing he’s lined up for the deal. One of the biggest questions at this point could therefore be how its bankers, who have pledged $25.5 billion in debt and margin loans, will proceed in this market that has changed significantly since signing in April.
PREPARE FOR A NEW CREDIT CARD SURCHARGE
A new survey suggests nearly one in five small businesses plan to take advantage of new power to levy surcharges on credit card transactions. The Canadian Federation of Small Businesses said 19% of survey respondents said they intend to take advantage of this option when it comes into effect tomorrow. about a quarter said they would if their competitors or suppliers applied the surcharge. the new voluntary levy is intended to help offset merchant fees and stems from a class action settlement with mastercard and visa. The Canadian Federation of Independent Business (CFIB) noted that due to consumer protection laws in Quebec, the surtax will not be available in that province.
OTHER NOTABLE STORIES
- Peyto Exploration announced after markets closed that CEO Darren Gee will retire at the end of this year. Jean-Paul Lachance, president of the natural gas producer, was chosen as successor.
- The chief executive of Boyd Group Services warned in a statement late yesterday that the recent closures caused by Hurricane Ian “will have a modest impact” on the company’s third and fourth quarter results. The auto repair company said a total of 62 facilities in Florida and South Carolina had been temporarily closed at one point; all but four have since reopened.
- Canada’s trade surplus shrank more than expected last month. Statistics Canada pegged the surplus at $1.5 billion – less than half of what Bay Street had forecast and the lowest balance this year. The data agency said the main driver was a 6% drop in energy exports. Statscan also revised the July surplus to around $2.4 billion from the $4 billion initially reported.
NEWS RELEASES / NOTABLE EVENTS
- Notable data: Canadian trade balance and building permits, Toronto Regional Real Estate Board monthly sales, US trade balance and US ISM services index