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Tag Archives: Canada

Fed’s Mid-Course Correction to be Challenged while ECB Resumes Bond Purchases

The week ahead will help shape the investment climate for the remainder of the year.  The highlights include three central bank meetings (Federal Reserve, Bank of Japan, and the Bank of Canada).  Among the high-frequency data, the US and the eurozone report the first estimates of Q3 GDP, and the US October jobs data and auto sales will be released.  Investors will also get the preliminary Oct CPI for EMU. A few hours before the FOMC meeting concludes on October 30, the US will...

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Lithium supply is set to triple by 2025. Will it be enough?

Lithium prices plummeted in 2019, as the market tipped into oversupply and EV growth slowed. Production of the battery metal is set to almost triple by 2025 to more than 1.5 million metric tons, but there are concerns that a fall in upstream investment could flip the market into undersupply further out. Lithium is an integral component of batteries for electric vehicles. As EV purchases have rocketed – over 2 million vehicles were sold in 2018 alone, according to S&P Global Platts...

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Trudeau will Lead a Coalition Government in Canada, while the UK’s Johnson Fights Another Day

Overview: Bismark is said to have warned that laws were like sausages, and to respect them, one ought not to see how they are made. The UK had a non-binding referendum more than three years ago, and although it won by 52%-48% and the party leaders committed to adhering to the results, it still cannot figure out how to leave. Prime Minister Johnson was dealt another setback in the House of Commons yesterday, but sterling remains near its highs as many hold on to the hope that the deal will...

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Dollar Soft, but Stage is being Set for Turn Around Tuesday

Overview: The UK's departure from the EU remains up in the air as a new attempt to pass the necessary legislation through Parliament continues today. Many market participants seem to remain optimistic that Prime Minister Johnson's plan will ultimately succeed. After slipping to $1.2875 initially, sterling briefly pushed through $1.30, which had held it back last week. Equities are firm. Nearly all the markets in Asia Pacific rose, and the Dow Jones Stoxx 600 is steady to higher.  The...

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The Week Ahead Excluding Brexit

I feel a bit like the proverbial guy that asks, "Besides that, Mrs. Lincoln, how did you like the play?" in trying to discuss the week ahead without knowing the results of the UK Parliament's decision on the new deal negotiated between Prime Minister Johnson and the EU.   I will write a separate note about Brexit before the Asian open. However, there are several other developments next week that will help shape the investment climate.   Europe is front and center.  Three issues outside...

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The US Jobs Data to Close a Sobering Week

Overview: The recovery of US shares yesterday signaled today's fragile stability. Gains in Japan, Australia, and Taiwan blunted the losses elsewhere in the region, including a 1% slide in Hong Kong.  The MSCI Asia Pacific Index fell for the third week. China's markets have been closed since Monday and will re-open Monday and may play some catch-up. Europe's Dow Jones Stoxx 600 is extending yesterday's recovery. Although the week's losses have been pared, the 3.3% drop would still be...

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Focus Shifts to North American Jobs Before Turning Back to Europe next Week

Overview:  Investors hope that the world took a step away from the abyss in recent days.  Developments in Hong Kong, US-China talking, a political and economic crisis in Italy appears to have been averted, and a risk of a no-deal Brexit has lessened.  Asia Pacific equities closed the week on a firm note and extended the rally the third week.  European shares are mixed today, but the Dow Jones Stoxx 600 is also posting its third consecutive weekly gain.  Back-to-back gaps higher have...

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Talking and Fighting in the Week Ahead

Equity markets and the US dollar closed last week and August on a firm note.  Ahead of the weekend, the dollar rose to new highs for the year against the euro, Swedish krona, Norwegian krone, and the New Zealand dollar.  While the next set of US and Chinese tariffs start September 1, the market is making the most of the lull. At the same time, US and Chinese officials probe each other to see if sufficient disruption has been felt to force concessions.  Talking and fighting are not...

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Existing North American oil pipelines boost capacity as new projects drag on

Canada’s three major options for new oil pipeline capacity continue to face delays and court challenges, but existing North American pipelines are finding ways to move more barrels to refiners and export docks on the US Gulf Coast. Midstream companies’ second-quarter earnings cycle revealed a wave of compressor-based pipeline expansions across the US Rockies and Midwest to increase throughputs at low costs and without major regulatory and construction risks. TC Energy and Enbridge are also...

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IMO 2020 hit to Canadian crude softened by changing market: Fuel for Thought

A surging differential for Western Canada’s benchmark heavy crude has traders and analysts wondering if predictions that tighter sulfur requirements for marine fuel next year will devalue the country’s oil assets are overblown. “Nobody is talking about IMO 2020 anymore,” one trading director at an investment bank in Calgary said. Market participants say a lot has changed since early forecasts suggested the International Maritime Organization’s rule limiting...

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