The Daily Chase: Shopify up after Black Friday

Here are five things you need to know this morning.

Calm before the storm: If you didn’t get a lot of rest this weekend, today is your last chance to fuel up ahead of a very busy calendar. In Canada, banks will start to report Tuesday, with Bank of Nova Scotia tomorrow and the rest peppered throughout this week. This Thursday we will get confirmation of whether Canada entered a recession, with a Statistics Canada read of September GDP and Q3 GDP. Jobs numbers come out on Friday, with the unemployment rate expected to rise to 5.8 per cent, which would be the highest rate since January 2022. Our American friends will be busy as well. The market will be asked to absorb some US$148 billion in new Treasury auctions. Wednesday is the U.S. Federal Reserve’s Beige Book, Thursday is the U.S. central bank’s preferred measure of inflation, Friday Fed Chair Jerome Powell speaks. Oh and by the way, ahead of all this, the volatility index is trading at the lowest level since before the pandemic began. Calm before the storm indeed.

Shop talk: Shares of Shopify are higher in the pre-market after the company said its merchants saw a 22 per cent increase in sales compared to last year’s Black Friday. Sales hit a record $4.1 billion. Shopify’s data captures all of its global sellers, but data from the U.S. is a little more subdued. MasterCard said sales were up only 2.5 per cent, but the growth in online was much better at 8.5 per cent. Adobe echoed the strength only with their data set suggest sales grew 7.5 per cent to hit a new record. All this to say, it seems the preference is to shop online versus in-store.

Hit the brakes: We will watch shares of CP Rail and CN Rail after an analyst downgrade this morning. Amit Mehrotra of Deutsche Bank is downgrading both the Canadian rails. A slowdown in Canadian consumers (I guess the Shopify data didn’t move him), headwinds in the grain markets and recent government intervention in Mexico are among the chief reasons for the downgrade. Recently, the Mexican government said it may soon require freight railroads to offer passenger services.