The Daily Chase: BlackBerry announces new CEO, scraps IPO plans
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Here are five things you need to know this morning.
Studying for finals: This week will be a test of market expectations for rate cuts as early as the spring. In the U.S., we will get a read of consumer inflation tomorrow, producer inflation on Wednesday morning and then the final U.S. Federal Reserve rate decision of 2023 on Wednesday afternoon. In order to understand how emphatically the Fed will push back on rate expectations, we first need to understand inflation, so tomorrow will be illuminating for the markets and the Federal Reserve. Nothing much happening today – it’s all positioning for the week ahead. Oil is making no moves this morning after slumping for a seventh week in a row in the longest losing streak since 2018. Bitcoin woke up on the wrong side of the bed with a brief “flash crash” to US$40,000 before settling at around $42,000.
On second thought: Shares of BlackBerry are under pressure in the pre-market after announcing a new CEO and scrapping plans for an IPO of its Internet of Things business. John Giamatteo will become the new CEO, moving up from president of BlackBerry’s struggling cybersecurity business. He certainly has the resume for the job, previously serving as chief revenue officer at McAfee and other leadership roles at places like Nortel. Investors appear disappointed with plans to scrap the IPO, even as BlackBerry says it is still going to separate the businesses, it just won’t spin one part out into the public markets. BlackBerry announced a strategic review in May after years of its stock languishing. Then in October, it announced the result of the review was to spin out its better-performing Internet of Things business. The stock has rallied a little since then, but clearly BlackBerry didn’t get the re-rating it was hoping for. What happens next? BlackBerry’s board chair says splitting the business operationally will open up a number of “strategic alternatives.” So this deal remains a live, albeit elusive, possibility.
Dirty laundry: Shares of Gildan Activewear are under pressure after the surprise ouster of the company’s co-founder and CEO. The maker of blank T-shirts announced this morning that Glenn Chamandy has “left his position” as president and CEO. Then Chamandy came out with his own press release saying he was fired without cause after 40 years of service. There is not much clarity about why he was fired. Gildan was taken public in 1998 by Bear Stearns and since then is up nearly 10,000 per cent. It has also outperformed so far this year, including after its latest set of earnings in early November, which saw the stock soar nearly 16 per cent. This is not the typical backdrop for a CEO ouster, so there is definitely more than meets the eye here.
Israel killed another top Iranian official -- the intelligence minister -- in its campaign against the Islamic Republic’s leadership, and an Iranian offshore natural gas field was struck Wednesday amid the war’s escalating pressure on the region’s economic lifeblood: energy.
Bank of Canada holds rate at 2.25 per cent as growth weakens and oil-driven inflation risks rise amid geopolitical uncertainty.
U.S. stocks are sinking Wednesday after a discouraging report said inflation was primed to worsen, even before the war with Iran sent oil prices spiking.
Jay Allen is a fan of U.S. President Donald Trump, and voted for him on the belief that the Republican would cut taxes and trim regulations, helping his manufacturing business in northeast Arkansas.
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Two Canadian cargo ships are stuck in the Persian Gulf and unable to pass through the blocked Strait of Hormuz as the war in Iran continues.
U.S. stocks are sinking Wednesday after another climb for oil prices raised worries about inflation, which may have been primed to worsen even before the war with Iran began.
U.S. crude stocks rose while gasoline and distillate inventories fell last week, the Energy Information Administration said on Wednesday.
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A key question hangs over the Federal Reserve’s two-day meeting that ends Wednesday: Will central bank policymakers still reduce short-term interest rates this year, now that the Iran war has sent oil prices higher and gas prices spiking? Or will they have to stand pat for months to see how the conflict plays out?
Wall Street followed global markets higher Wednesday and the price of U.S. crude fell eased despite a new barrage of attacks by Iran on its Gulf neighbors.
Jay Allen is a fan of U.S. President Donald Trump, and voted for him on the belief that the Republican would cut taxes and trim regulations, helping his manufacturing business in northeast Arkansas.
Shares advanced Wednesday in Europe and Asia as oil prices fell back slightly despite a barrage of attacks by Iran on its Gulf neighbours.