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The Week of July 30th to August 5th, 2018 “A Brief Look Back Into tomorrow”

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The new North American trading week began uneventfully on Monday, July 30th as the heat of summer seemed to be drawing investor interest away from geo-political and economic events that have been capturing the markets’ attention.




To which technical analysts David Tippin & Ron Meisels commented – “August could become a relatively sideways month….” (For a complete copy of this report please contact Rod.Blake@canaccord,com.)




Statistics Canada reported that foreign purchases of Canadian securities fell to $29-billion in the first 5-months of this year.




The National Energy Board reported that Canadian crude oil shipments by rail rose by 42% in the past year to May to an average of 198,788 barrels-per-day. Meanwhile – total Canadian crude oil production rose by over 15% to 4.4-million barrels-per-day.




Heavy machinery giant Caterpillar Inc. ‘CAT-N’ reported better than expected 2nd-quarter financials and better yet – raised its forecast for the year ahead.




Ivanhoe Mines ‘IVN-T’ shares’ rose by 5% to $2.55 after the African based mineral developer released a positive resource update for its Kipushi copper/zinc project.




Tuesday, July 31st started with Statistics Canada announcing that the country’s gross domestic product (GDP) improved from April to May by 0.5%.




Nuclear reactors eventual wear out, and SNC-Lavalin ‘SNC-T’ announced it was awarded a multi-million-dollar contract to decommission New Jersey’s Oyster Creek Nuclear Generating Station – the oldest nuclear power station in the United States.




The share price of WestJet Airlines ‘WJA-T’ fell by over 8% to $18.32 after Canada’s second largest airline posted its first quarterly loss in the past 13-years.




Shopify Inc. ‘SHOP-T’ shares’ fell by 5.5% to $181.22 after the online commerce company failed to impress the street with its 2nd-quarter financials.




The U.S. Federal Reserve (FED) did as expected on Wednesday, August 1st and left their key interest rate unchanged at 1.75 -2.00%.




Wednesday, August 1st saw the price of Enercare Inc. ‘ECI-T’ stock soar up by almost 53% to $28.90 on word the heating company received a $4.3-billion all-cash or stock take-over offer from real estate giant Brookfield Infrastructure Partners ‘BIP.UN-T’.




Molson Coors Canada ‘TPX.B-t’ announced they were working with The Hydropothecary Corp. ‘HEXO-T’ to develop cannabis based non-alcoholic beverages.




Similarly, insurer Manulife Financial ‘MFC-T ’and pharmacy Shoppers Drug Mart ‘L-T’ are teaming up to partner in a medical cannabis program.




Many eyes were on Apple Inc ‘AAPL-Q’ as the company’s shares’ rose by almost 6% to US$201.50 after the giant tech once again handily beat the streets’ expectations with its 2nd-quarter financials.




Thursday, August 2nd saw the price of Tesla Inc. ‘TSLA-Q’ stock surge up by over 16$ to US$349.54 after the world’s premier electric auto manufacturer reported better than expected production and forward guidance figures.




Gildan Activewear ‘GIL-T’ shares’ rocketed up by 21.5% to $41.10 after the clothing company reported record 2nd-quarter sales.




Bombardier Inc. ‘BBD.B-T’ stock rose by over 3% to $4.91 after the world’s largest commuter train and nosiness jet manufacturer reported a surprise 2nd-quarter profit.




And Apple Inc. ‘AAPL-Q’ – with a closing price of US$207.39 – became the first American based company to achieve a market cap of over US$1-trillion.




The U.S. Labor Department reported on Friday, August 3rd that their economy added a less than expected 157,000 new jobs in July and that the country’s unemployment rate eased lower by another 0.1% to 3.9%.




Petroleum industry consultant Baker Hughes ‘BHGE-N’ reported that the number of active American drilling rigs fell by 4-rigs last week to 1,044 active rigs. Up north – the number of active Canadian drilling rigs was unchanged at 223 active rigs.




During the Week – the TSX Venture Exchange fell to a new 2-year low of 700 while the price of gold bullion dropped to a new 1-year low of US$1,220-an-ounce. Meanwhile, the VIX dropped to a 6-month low of 11.07.




Husky Energy ‘HSE-T at $22.12, OceanaGold Corp. ‘OGC-T’ at $4.04 and Ur-Energy ‘URE-T’ at $1.02 all reached new TSX 52-week trading highs while Americas Silver ‘USA-T at $3.22, Gildan Active Wear ‘GIL-T’ at $33.12 and Sleep Country Canada ‘ZZZ-T’ at $30.27 all fell to new 52-week trading lows.




For the Week – the Dow Industrials rose by 0.05% to 25,463, with the S&P 500 up by 0.74% top 2,840 and the NASDAQ ahead by 0.97% to 7,812. Across the line – the TSX Composite gained 0.16% to 16,420 while the TSX Venture lost 0.71% to 702.




With Commoditiesgold bullion fell by 0.88% to US$1,222, with copper down by 1.3% to US$2.76, as crude oil dropped by 0.17% to US$68.62 while natural gas gained 2.16% to US$2.84. Overall – the CRB Spot Commodity Index fell by 1.15% to end the week at 428.




The Canadian dollar improved by 1.26% against the American dollar to finish the week at US$0.7696.




Ans the closely watched CBOE Volatility Index or VIX fell by 1.96-points to end the week at a much calmer level of 11.07.




And Finally – While we personally seem to be paying more and more taxes – the same is not so for corporations – as a recent University of Copenhagen study has found that the average global tax rate has fallen from 49% in 1985 to just 24% today.

Posted August 8, 2018

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