2023-07-12 14:20:42
(Illustration: Camille Charbonneau)
NEWS ESSENTIALS
• BoC — Rate hike expected in the face of a still-tight labor market. The Bank of Canada is expected to raise its key rate by a quarter of a percentage point on Wednesday to a 22-year high of 5.00% as economic growth continues to fuel a tight job market and a underlying inflation persistent, according to analysts.
• Agreement in sight to end the strike in the ports. Canadian Labor Minister Seamus O’Regan said on Tuesday that a bargaining agreement would soon be reached to end the dispute between striking Canadian longshoremen and their employers.
• The regulator wants banks to strengthen their capital. Canada’s banking regulator on Tuesday proposed changes to capital adequacy guidelines that would require banks and mortgage insurers to hold more funds to better manage risks from sharply rising bond interest rates. real estate loans.
• Green light for Broadcom’s proposed acquisition of VMware. The European Commission on Wednesday cleared the proposed acquisition of VMware by US chipmaker Broadcom, following offering commitments to competitor Marvell Technology.
• Illumina receives record EU fine. The US genetic testing company has been fined a record 432 million euros for completing the takeover of Grail before obtaining EU clearance.
TRENDS BEFORE OPENING
Futures for Canada’s resource-heavy main equity index rose on higher oil and copper prices as investors await the Bank of Canada’s rate decision of interest. U.S. stock index futures edged higher on hopes of a further slowdown in U.S. inflation, which might temper the Federal Reserve’s hawkish stance on monetary policy. European equities also advanced as major UK banks advanced following passing the Bank of England’s stress test. In Asian equity markets, Hong Kong shares rose, boosted by stronger-than-expected credit numbers and tech sector gains, while the Nikkei hit a month-to-month low on strength in the yen. The US dollar fell once morest a basket of benchmark currencies, while the pound rose to its highest level in 15 months. Gold prices hit their highest level in three weeks.
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TITLES TO FOLLOW
• Laurentian Bank: Canada’s ninth bank said Tuesday it was conducting a review of policy options. Earlier in the day, The Globe and Mail daily reported that the bank’s board had recently hired financial and legal advisers to explore the possibility of a sale. The group said no further information will be released until the review is complete. In its statement, the bank said it was “exceeding” its financial targets in an increasingly difficult macroeconomic environment and once morest a backdrop of market volatility. The Canadian financial sector is experiencing a consolidation movement since the proposal of the Royal Bank, the largest lender in the country, to buy the Canadian subsidiary of HSBC.
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