Here are five things you need to know this morning:
Doldrums: Well, the TSX is officially in a funk. It closed Thursday at the lowest level since Oct. 21, 2022 and is almost in official “correction” territory (a pull back of 10 per cent or more from recent peak). The sell-off in U.S. markets yesterday has the S&P 500 careening toward a correction as well. A read of investor sentiment by AAII has bearish sentiment at the highest level since May. We will watch for the markets ability to withstand a fresh read of inflation from this morning. The U.S. Federal Reserve’s preferred measure of inflation (personal consumption expenditure, or PCE) showed inflation accelerating to a four-month high.
The Everything Store: Shares of Amazon are trading up in the pre-market and we will watch for its ability to hold gains after a pretty dismal reaction to other tech earnings. Today investors are applauding Amazon’s ability to beat sales and earnings expectations while showing signs of stabilization in its key cloud computing business. While many of us know Amazon from those packages that show up at our doorstep more times than we can count, it is the cloud business that powers the bottom line. Amazon’s cloud business is just 16 per cent of total sales this quarter, but nearly 64 per cent of its operating income.
Call it a comeback: Shares of Intel are rallying after the PC-exposed chip maker predicted a return to sales growth in the fourth quarter. This is welcome relief for investors who have watched Intel sales fall for seven quarters in a row. To some extent the stock has front-run the improved outlook. Shares are up more than 20 per cent so far this year. Of course, that has massively lagged other chip makers that have the benefit of AI at their back. I’ll watch for how this momentum carries into a re-rating for the stock as the majority of analysts still view Intel as a hold, not a buy.
The Corus is off: I’ll watch shares of Corus Entertainment at the open after the company reported profit that missed expectations and suspended its dividend. However, revenue beat expectations as it didn’t fall as much as feared. Still, the media company that operates TV channels and radio stations is continuing to face an advertising recession with declines in almost all advertising categories. Suspending the dividend will help to address its massive debt burden. We will speak with Corus Entertainment president and CEO Doug Murphy on BNN Bloomberg at 9:40 A.M. EDT.
Bank layoffs: Bloomberg is reporting that National Bank has cut a number of jobs in its capital markets business, according to its sources. While we don’t know the exact number, we know it is part of a growing trend of layoffs in the banking sector. An estimated 6,000 jobs have been lost amid a wave of job cuts by the Bank of Montreal, Royal Bank of Canada and Bank of Nova Scotia, according to Bloomberg. This comes as many of these bank stocks are trading at 52-week lows.
Notable Guest
From bakery to bread empire: Tune in for our interview with Panera Bread founder and former CEO Ron Shaich at 1:10 p.m. EDT. He’ll tell us about the company’s journey, the evolution of the restaurant business and his new book, “Know What Matters: Lessons from a Lifetime of Transformation.”