The Daily Chase: GM beats earnings expectations; Spotify under pressure
BNN Bloomberg
Here are five things you need to know this morning.
Here are five things you need to know this morning.
Market mood: Today is a middle-child kind of day for markets with attention split between what happened yesterday and what is going to happen tomorrow. The Dow rose for an 11th day in a row – the longest streak since February 2017. Tomorrow the focus will be on how Alphabet and Microsoft trade (they report today after the close) and of course the U.S. Federal Reserve rate decision. The U.S. central bank is expected to increase interest rates again, but maybe for the last time. RBC’s head of rates strategy says this could be a non-event for markets. From his lips. Today 34 companies on the S&P 500 are reporting.
Telecom watch: We are going to be watching Canadian telcos at the open after a major decision by the Canadian Radio-television and Telecommunications Commission (CRTC) last night. Rogers and Quebecor/Freedom have been before the CRTC trying to agree on rates Quebecor will pay to Rogers for using its network to provide cell coverage outside of Quebecor’s home network. The CRTC sided with Quebecor’s proposed rate structure. While the CRTC did not disclose the rate, most analysts today are viewing this as positive for Quebecor and negative for incumbents like Rogers, BCE (which owns BNN Bloomberg through its Bell Media division) and Telus because it could put further pressure on prices. Scotia’s Maher Yaghi goes one step further in his caution noting that as part of the decision the CRTC says when making considerations about deciding what rate new entrants will pay to established networks the regulator said reasonable rates may not provide an immediate term return on investment or possibly require an otherwise profitable enterprise to incur a modest or temporary loss. In other words, the CRTC could force the incumbents to take a short-term financial hits in order to allow new entrants to survive. “We continue to believe that investors remain complacent,” Yaghi said in a note to clients, about the regulator risk to Canadian incumbent telcos.