Author: Consultant

Crude oil prices climbed higher on Friday after Russia played down the prospect of additional output cuts by OPEC+.

Russian Deputy Prime Minister Alexander Novak said on Thursday that he doesn’t think there will be new steps with regard to production cuts.

Oil was also supported by reports that U.S. lawmakers are closing in on a deal that would raise the government’s $31.4 trillion debt ceiling for two years while capping spending on most items.

West Texas Intermediate crude oil futures for July ended higher by $0.84 or about 1.2% at $72.67 a barrel. WTI crude futures gained about 1.6% in the week, after surging 2.2% last week.

Brent crude futures settled at $76.95 a barrel, gaining $0.69 or about 0.9%. Brent futures gained 1.8% in the week.

According to the data released by Baker Hughes, total active drilling rigs in the U.S. fell by another 9 to 711, the lowest count in a year.

Drilling rigs targeting crude oil in the U.S. fell by 5 to 570, its lowest number since last May, and gas rigs dropped by 4 to 137, the lowest since March last year. Total rigs targeting crude oil in the Permian Basin gained 1 to 347.

“The upcoming week could deliver a make-or-break moment for oil as we will see if Chinese manufacturing is rebounding, if the US labor market is reading to soften, how oil giants Exxon and Chevron address climate ambitions at their AGMs, and what if the Saudis and Russians can reach agreement on what to drive OPEC+ do with output,” says Edward Moya, Senior Market Analyst at OANDA.

ORONTO, May 23, 2023 /CNW/ – (TSX: WN) – George Weston Limited (“Weston”) announced today that the Toronto Stock Exchange (“TSX”) has accepted a notice filed by Weston of its intention to make a normal course issuer bid (“NCIB”).

The TSX notice provides that Weston may, during the 12-month period commencing May 25, 2023 and terminating May 24, 2024, purchase up to 6,954,013 Weston common shares (“Common Shares”), representing approximately 5% of the 139,080,273 Common Shares issued and outstanding as of May 11, 2023, by way of a NCIB on the TSX or through alternative trading systems or by such other means as may be permitted under applicable law. Based on the average daily trading volume of 151,757 during the last six months, daily purchases will be limited to 37,939 Common Shares, other than block purchase exceptions.

Purchases of Common Shares will be made in open market transactions on the TSX, through alternative trading systems, or by such other means as may be permitted by applicable law, including private agreement purchases. In addition, Weston may enter into forward purchase or swap contracts in connection with Common Shares which may be settled by physical settlement, cash settlement or a combination thereof. The forward price will be based on market price, dividend yield and market interest rates. 

Decisions regarding the timing of future purchases of Common Shares will be based on market conditions, share price and other factors. Weston may elect to suspend or discontinue its NCIB at any time. Common Shares purchased under the NCIB will be cancelled or transferred to and held by trusts established by Weston for the settlement of equity settled incentive plans. Weston believes that the market price of Common Shares could be such that their purchase may be an attractive and appropriate use of corporate funds. Weston may also use its NCIB to acquire the number of Common Shares that are issued pursuant to the exercise of options in order to offset the dilutive effect of options that have been exercised.  Pursuant to its previous NCIB, under which Weston received approval from the TSX to purchase up to 7,304,927 Common Shares for the period of May 25, 2022 to May 24, 2023, 6,645,013 Common Shares have been purchased as of May 11, 2023, at a weighted average price of $158.74.

From time to time, when Weston does not possess material non-public information about itself or its securities, it may enter into a pre-defined plan with its broker to allow for the purchase of Common Shares at times when Weston ordinarily would not be active in the market due to its own internal trading blackout periods and insider trading rules. Any such plans entered into with Weston’s broker will be adopted in accordance with the requirements of applicable Canadian securities laws.

About George Weston Limited

George Weston Limited is a Canadian public company founded in 1882. The Company operates through its two reportable operating segments, Loblaw Companies Limited and Choice Properties Real Estate Investment Trust. Loblaw provides Canadians with grocery, pharmacy, health and beauty, apparel, general merchandise, financial services and wireless mobile products and services. Choice Properties owns, manages and develops a high-quality portfolio of commercial and residential properties across Canada.

SOURCE George Weston Limited

The Canadian market ended on a firm note on Friday, aided by strong gains in technology, consumer discretionary and financials sectors.

The mood in the market remained fairly positive amid signs of progress in U.S. debt ceiling deal negotiations.

The benchmark S&P/TSX Composite Index ended with a gain of 146.23 points or 0.74% at 19,920.31. The index scaled a low of 19,832.78 and a high of 19,944.09 intraday. The index shed 2.1% in the week.

The Capped Information Technology surged nearly 2%. Celestica Inc (CLS.TO) soared 10.3%. Hut 8 Mining Corp (HUT.TO) rallied nearly 6%. Coveo Solutions (CVO.TO), Converge Technology Solutions (CTS.TO), Bitfarms (BITF.TO), Kinaxis (KXS.TO), Open Text Corporation (OTEX.TO), Constellation Software (CSU.TO), Enghouse Systems (ENGH.TO), Quarterhill (QTRH.TO) and Docebo Inc (DCBO.TO) gained 1.5 to 4.3%.

Consumer discretionary stocks Spin Mater Corp (TOY.TO), Dollarama Inc (DOL.TO), Gildan Activewear (GIL.TO) and Magna International (MG.TO) advanced 1.5 to 2%.

Among financials, Fairfax Financial Holdings (FFH.TO) climbed more than 3%. Bank of Montreal (BMO.TO), Nuvei Corp (NVEI.TO), Manulife Financial (MFC.TO), goeasy (GSY.TO), Canadian Imperial Bank of Commerce (CM.TO) and Royal Bank of Canada (RY.TO) ended higher by 1.3 to 1.6%.

Healthcare stock Tilray Inc (TLRY.TO) tanked 20.5% after the company said it would be offering a 5.2% convertible senior note offering due in 2027 and announced pricing of $150 million of that.

On the economic front, preliminary data from Statistics Canada showed wholesale sales in Canada increased 1.6% month-over-month in April 2023, after a 0.1% drop in March.

• President Joe Biden said negotiators were “very close” to a compromise agreement Friday evening to raise the debt ceiling.
• House Republicans appeared on track to win on some top priorities, including rescinding some of the $80 billion allocated for the IRS by last year’s Inflation Reduction Act.
• New guidance from the Treasury Department estimated that the U.S. would not run out of money to pay its bills before June 5 — four days later than the previous estimate.

Debt ceiling: Biden optimistic about deal (cnbc.com)

SECOND QUARTER FINANCIAL HIGHLIGHTS, compared with the second quarter last year:

• Reported diluted earnings per share were $1.72, compared with $2.07.
• Adjusted diluted earnings per share were $1.94, compared with $2.02.
• Reported net income was $3,351 million, compared with $3,811 million.
• Adjusted net income was $3,752 million, compared with $3,714 million.

YEAR-TO-DATE FINANCIAL HIGHLIGHTS, six months ended April 30, 2023, compared with the corresponding period last year:

• Reported diluted earnings per share were $2.54, compared with $4.09.
• Adjusted diluted earnings per share were $4.17, compared with $4.09.
• Reported net income was $4,933 million, compared with $7,544 million.
• Adjusted net income was $7,907 million, compared with $7,547 million.

https://www.newswire.ca/news-releases/td-bank-group-reports-second-quarter-2023-results-800577454.html

Results for the second quarter of 2023 were affected by the following items of note aggregating to a positive impact of $0.06 per share:

• $114 million ($82 million after-tax) decrease in legal provisions (Corporate and Other); and
• $27 million ($21 million after-tax) amortization of acquisition-related intangible assets.

Our CET1 ratio⁽⁴⁾ was 11.9% at April 30, 2023, compared with 11.6% at the end of the prior quarter. CIBC’s leverage ratio⁽⁴⁾ and liquidity coverage ratio⁽⁴⁾ at April 30, 2023 were 4.2% and 124%, respectively.

CIBC announced an increase in its quarterly common share dividend from $0.85 per share to $0.87 per share for the quarter ending July 31, 2023.

https://www.newswire.ca/news-releases/cibc-announces-second-quarter-2023-results-871795459.html

Royal Bank of Canada¹¹ (TSX: RY) (NYSE: RY)) today reported net income of $3.6 billion for the quarter ended April 30, 2023, down $604 million or 14% from the prior year. Diluted EPS was $2.58, down 13% over the same period. Adjusted net income⁷ and adjusted EPS⁷ of $3.8 billion and $2.65 were down 13% and 11% from the prior year, respectively.

Results this quarter reflected higher provisions for credit losses, with a PCL on loans ratio of 30 bps, mainly attributable to provisions taken on performing loans in the current quarter, largely driven by unfavourable changes in our credit quality and macroeconomic outlook, as compared to releases in the prior year which reflected reduced uncertainty from the COVID-19 pandemic. The current quarter also reflected higher provisions on impaired loans.

Pre-provision, pre-tax earnings⁷ of $5 billion were up $54 million or 1% from a year ago, mainly reflecting higher net interest income driven by higher interest rates and strong loan growth in Canadian Banking and Wealth Management. Higher Corporate & Investment Banking revenue in Capital Markets also contributed to the increase. These factors were partially offset by higher expenses, mainly due to higher staff-related costs, including from headcount growth, as well as stock-based compensation. Higher professional fees (including technology investments) and higher discretionary costs to support strong client-driven growth also contributed to higher expenses.

Today we declared a quarterly dividend of $1.35 per share reflecting an increase of $0.03 or 2%.

https://www.newswire.ca/news-releases/royal-bank-of-canada-reports-second-quarter-2023-results-884048760.html

U.S. crude oil and distillate inventories fell unexpectedly last week as imports declined, while gasoline stockpiles dropped more than forecast, the Energy Information Administration said on Wednesday.

Crude inventories fell by 12.5 million barrels in the week to May 19 to 455.2 million barrels ahead of the driving-intensive Memorial Day weekend holiday, compared with analysts’ expectations in a Reuters poll for an 800,000-barrel rise.

Net U.S. crude imports fell by 1.25 million bpd, the EIA said, while the crude oil adjustment figure fell by 1.16 million barrels per day, according to the EIA data.

Gasoline, jet fuel and distillate product supplied – proxies for fuel demand – each rose last week, helping to fuel the drawdowns in stocks.

Refinery crude runs rose by 79,000 barrels per day, and refinery utilization rates fell by 0.3 percentage point in the week.

“It looks like demand is back. … Refiners are absolutely going max out with refinery runs right now, trying to keep up with demand,” said Phil Flynn, an analyst at Price Futures Group.

Distillate stockpiles, which include diesel and heating oil, fell by 600,000 barrels to 105.7 million barrels, their lowest level since May 2022, EIA data showed.

Gasoline stocks also fell by a more than expected 2.1 million barrels in the week to 216.3 million barrels, the EIA said.

Crude stocks at the Cushing, Oklahoma, delivery hub rose by 1.8 million barrels in the week, the EIA said.

Domestic production rose by 100,000 barrels per day in the week, but the four-week average of 12.275 million barrels per day is only up 3.4 per cent from year ago levels.

“The rate of growth is disappointing given the low price of oil and the fact that producers are slowing down on their capital spending for drilling,” said Andrew Lipow, president of Lipow Oil Associates in Houston.

Bank of Nova Scotia (BNS) on Wednesday reported fiscal second-quarter net income of $1.57 billion.

The bank, based in Toronto, said it had earnings of $1.24 per share. Earnings, adjusted for non-recurring costs, were $1.25 per share.

The results did not meet Wall Street expectations. The average estimate of four analysts surveyed by Zacks Investment Research was for earnings of $1.32 per share.

The bank posted revenue of $12.78 billion in the period. Its revenue net of interest expense was $5.85 billion, which also missed Street forecasts.

Bank of Nova Scotia shares have climbed slightly since the beginning of the year. The stock has declined 23% in the last 12 months.

The bank says it will now pay a quarterly dividend of $1.06 per share, up from $1.03 per share.