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The Week of December 7th to December 13th, 2015 “A Brief Look Back Into Tomorrow”

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The Week of December 7th to December 13th, 2015 “A Brief Look Back Into Tomorrow”

 

 

 

 

 

The new trading week began on Monday, December 7th and followed an Organization of Petroleum Exporting Countries (OPEC) admission that its members had been cheating on their crude oil production quotas (Surprise!) and that the oil cartel was effectively throwing in the towel on its ability to control the worldwide flow of crude oil.

 

 

 

Goldcorp Inc. (G-T) announced that Hudbay Minerals (HBM-T) CEO David Garofalo will be taking over the CEO reins of the world’s second largest gold producer when their current CEO Chuck Jeannes retires in the spring of 2016.

 

 

 

Keurig Green Mountain (GMCR-Q) shares’ skyrocketed up by almost 72% to US$88.89 on word that the single serving coffee company was being bought out by private equity JAB Group in an all-cash deal of some US$13.9-billion.

 

 

 

M&A activity continued on Tuesday, December 8th with Cott Corp (BCB-T) announcing they were buying Aquaterra, Canada’s oldest and largest direct water delivery company, in an all cash deal of some $62-million.

 

 

 

Meanwhile, south of the border, American antitrust enforcers sighted elimination of competition as reason they filed to stop the Staples (SPLS-Q) takeover of fellow office supply company Office Depot (ODP-N).

 

 

 

British mining giant Anglo American PLC (NGLOY-Q) announced drastic cost cutting measures by intending to dispense of 60% of their assets and reducing their workforce by some 85,000 workers to just 50,000 people.

 

 

 

The Canadian Mortgage and Housing Corporation or CMHC reported that the country’s new home construction rose by 7.2% in November to a seasonally adjusted 211,916 units.

 

 

 

The share price of United Natural Foods (UNFI-Q) fell by over 6% to US$36.82 when the company reported weaker than expected 3rd quarter earnings and worse yet – lowered their forecast for the year ahead.  

 

 

 

Wednesday, December 9th saw the share price of Dow Chemical (DOW-N) and Du Pont    (DD-N) rise by almost 12% respectively after a Wall Street Journal story suggested the iconic American companies with almost 300-years of combined history were contemplating a merger deal of some US$120-billion.

 

 

 

Dollarama Inc.  (DOL-T) shares’ fell by over 7% to $81.70 after Canada’s largest discount retailer suggested that the company’s extraordinary growth may normalize in the years ahead.

 

 

 

The price of lululemon Athletica (LULU-Q) dropped by almost 13.5% to US$45.15 after the yogawear retailer failed to impress the street with its 3rd-quarter financials.

 

 

 

People continue to tale to the skies and on Thursday, December 10th, Transat A.T. (TBE-T) confirmed this as its share price soared up by over 20% to $7.18 after the holiday charter carrier reported much better than expected 4th quarter results that included a 15% increase in bookings.

 

 

 

Westshore Terminals (WTE-T) shares plunged by almost 20.5% to $13.05 when the giant west coast bulk loader of coal once again cut its dividend and worse yet – warned of deceases in coal shipments to come.

 

 

 

And the price of Men’s Wearhouse (MW-N) dropped by 17% to US$15.26 when the giant men’s haberdasher warned it may miss its profit projection for the rest of the year.

 

 

 

The downward pressure on crude oil got even worse on Friday, December 11th after the International Energy Agency (IEA) projected that the global oversupply of crude oil could worsen in 2016.

 

 

 

 

The U.S. Commerce Department reported that retail sales rose by a seasonally adjusted 0.2% in November to US$448-billion.

 

 

 

The number of active oil rigs kept dropping as Baker Hughes reported the number of active US oil & gas drilling rigs fell by another 21 last week to just 534 rigs.

 

 

 

BRP Inc. (DOO-T) shares’ rose by 9.5% to $22.10 when the Ski-Doo and Sea-Doo manufacturer reported better than expected 3rd-quarter financials.

 

 

 

Conversely, the price of Hudson’s Bay Co. (HBC-T) shares fell by over 12.5% to $17.40 when Canada’s iconic retailer failed to impress the street with its 3rd-quarter results.

 

 

 

Equity markets tumbled on word that Third Avenue Management was freezing withdrawals from its US$788-million high-yield credit mutual fund.

 

 

 

During the week  The price of copper closed at a new 6-year low of US$2.05-a-pound, while crude oil also fell to a new 6-year low of US$35.45-a-barrel, and natural gas plunged to a new 15-year low of US$1.98/mmbtus. This helped pull the CRB Spot Commodity Index down to a 6-year low of 380. All of which drove the TSX Composite Index down to a new 2-year low of 12,264 and the TSX Venture Exchange to a new record low of 502. The Canadian dollar fared no better as it plunged to a new 11-year low of US$0.7281.

 

 

 

Boyd Group Income Fund (BYD.UN-T) at $70.45, CCL Industries (CCL.B-T) at $231.99 and Molson Coors Canada (TPX.B-T) at $129.98 all set new TSX 52-week trading highs, while ATCO Ltd. (ACO.X-T) at $33.18, Enbridge Inc. (ENB-T) at $41.01 and OilSands Sector Fund (OSF.UN-T) at $3.70 all fell to new 52-week trading lows.

 

 

 

For the WeekThe Dow Industrials fell by 3.27% to 17,264, with the S&P 500 Index off by 3.82% to 2,012 and the NASDAQ Exchange down by 4.06% to 4,933. In Canada, the TSX composite Index was down by 4.26% to 12,790 and the TSX venture Exchange was lower by 2.90% to 502.

 

 

 

With commodities – Gold bullion eased by 0.74%to US$1,076, with copper up by 1.44% to US$2.11, while crude oil plunged by 11.31% to US$35.45 and natural gas fell by 9.59% to US$1.98. Overall, the CRB Spot Commodities Index fell by 1.81% to finish the week at 380.

 

 

 

The Canadian dollar sank by 2.70% against its southern cousin to end the week at US$0.7281.

 

 

 

And the closely watched CBOE Volatility Index or VIX jumped up by 9.9-points to finish the week at a much more nervous level of 24.71.

 

 

 

And Finally – Broadband services company Sandvine reports that the amount of video streaming supplied by companies such as Netflix and Youtube has more than doubled in the past 5-years and now accounts for up to 70% of internet usage during peak periods.

 

 

 

Posted December 14, 2015

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