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TSX, Crude Rally; Enbridge CEO To Step Down; Canadian, Global PMIs Contract

Stock Markets Oct 03, 2022 10:37
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By Ketki Saxena 

Investing.com -- The TSX tracked Wall Street higher as expectations for rate hikes from the U.S. Federal Reserve, along with yields on the benchmark 10 year U.S. treasury, receded from last week’s peak. 

Investors appear to betting that the recent indicators of a slowdown in the US economy, and globally, will force the world’s most powerful central bank to temper its hawkish forward guidance. Global factory output surveys showed a steady decline as inflation and tighter monetary policy pressured demand, surveys showed. Manufacturing activity declined significantly in the EU, Britain, Taiwan, Malaysia and China, while activity grew at a slower pace in Japan, India and Vietnam. Today’s data shows that Canadian manufacturing activity also contracted for a second straight month in August. 

Beyond the broad-based rebound in equities supported by the pullback in yields, the commodity-heavy Canadian index was also buoyed by a rally in oil prices as OPEC+ mulls output reduction of over +1 million barrels per day (bpd). The bloc intends to support crude prices, which fell drastically in Q3 to below $80/barell after reaching $120 in June. If OPEC+ goes through with the cut, it would be its biggest output reduction since the beginning of the COVID-19 pandemic.

Crude prices also received a boost from a new sanctions package against Russia proposed by the European Union, expected today. The deal is likely to include a price cap on Russian oil, with the exact level of the cap to be approved at a later stage.

The Biggest Stories on Bay Street

Enbridge (TSX:ENB) CEO Al MOncao will be retiring at the end of next year, Al Monaco is retiring from Enbridge at the start of next year. He will be succeeded by Greg Ebel, the company’s current chair. Monaco’s retirement will come just after a decade leading the company. He was appointed as CEO in Oct. 2012 and will be staying on as an advisor  until March 1, 2023.

Algonquin Power & Utilities Corp (TSX:AQN). has signed a deal to sell its 49% stake in a portfolio of three operating wind projects in the United States and and its 80% stake in a Saskatchewan facility to InfraRed Capital Partners. InfraRed is part of SLC Management, the institutional alternatives and traditional asset management business of Sun Life Financial (TSX:SLF) Inc. Total cash proceeds from the deal are expected to be about US$277-million for the U.S. facilities and C$107-million for the Canadian operations, subject to customary closing adjustments.

Interfor Corp (TSX:IFP). announced it has signed a deal with an affiliate of the Kilmer Group to buy Chaleur Forest Products, which owns sawmill operations in in New Brunswick for C$325-million. The operations include with a combined annual lumber production capacity of 350 million board feet. The company’s  woodlands management division further manages about 30% of the total Crown forest in N.B. 

Canadian Stocks Moving Markets This Morning 

Top Gainers: 

  • Endeavour Silver (TSX:EDR) (+9.62%) 
  • Athabasca Oil  (TSX:ATH)(+8.92%) 
  • NexGen Energy (TSX:NXE) (+8.57%) 

Top Losers: 

  • Saputo (TSX:SAP) (-3.25%)
  • Boyd Group (TSX:BYD) (-2.63%) 
  • FirstService Corp (TSX:FSV) (-0.91%) 

In Canadian Economics 

The S&P Global (NYSE:SPGI) Canada Manufacturing Purchasing Managers' Index (PMI) showed that Canadian manufacturing activity contracted for a second straight month in August. 

"Output and new orders continued to fall with the sector still feeling the repercussions of material shortages and delivery delays," Shreeya Patel, an economist at S&P Global, said in a statement. "Demand was once again hit by client hesitancy in the wake of rising interest rates and weak macroeconomic conditions."

TSX, Crude Rally; Enbridge CEO To Step Down; Canadian, Global PMIs Contract
 

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