TOP NEWS
• US Congress averts historic default, approves debt-limit suspension
The U.S. Senate on Thursday passed bipartisan legislation backed by President Joe Biden that lifts the government's $31.4 trillion debt ceiling, averting what would have been a first-ever default.
• Toronto home prices rise in May as sales jump 20%
Greater Toronto Area home prices increased in May from April and sales rose sharply, adding to evidence that the housing market has turned a corner after being buffeted by higher borrowing costs.
• Slower US job, wage gains expected in May
U.S. job growth likely slowed in May, with wages coming off the boil, potentially allowing the Federal Reserve to skip an interest rate hike this month for the first time since embarking on its aggressive policy tightening campaign more than a year ago.
• Fed's new projections may fill the void on interest rate guidance
Federal Reserve officials, whose hike, skip or pause messaging on interest rates has become a high-stakes word puzzle for investors, seem ready to end the U.S. central bank's run of 10 straight rate increases later this month while leaving the door open to a future rise in borrowing costs.
• PREVIEW-Global airline summit to tackle travel boom, climate goals
Airlines will ride the crest of a faster-than-expected recovery and discuss ways of translating climate pledges into action at a summit buoyed by a return to business as usual next week.
BEFORE THE BELL
Canada's main stock index futures rose as oil prices were up with attention turning to a meeting of OPEC ministers and their allies at the weekend. Wall Street futures edged higher as investors took comfort from the passing of the U.S. debt ceiling bill, with focus now shifting to U.S. payrolls data due later in the day that will determine whether the Federal Reserve sticks with its interest rate-hiking regime. In global markets, European shares were up with real estate and mining stocks in the lead, while Japan's Nikkei closed at a three-decade high. The U.S. dollar headed for its largest weekly fall since mid-January, while gold prices gained.
STOCKS TO WATCH
Results
• Lululemon Athletica Inc: The company raised its annual sales and profit forecasts on Thursday as wealthy Americans snap up its pricey activewear even though inflation hounds wider retail spending, sending the company's shares up after hours. Lululemon's inventories at quarter-end were up 24%, a smaller increase than the company had estimated in March. It expects growth of about 20% at the end of the current quarter. The easing of China's strict COVID-19 curbs bolstered revenues from the region by 79%, while North America sales jumped 17%. That drove net revenue up 24% to $2 billion in the quarter, beating estimates of $1.93 billion. Lululemon now expects full-year 2023 revenue between $9.44 billion and $9.51 billion, compared with $9.30 billion to $9.41 billion projected earlier. It forecast annual profit between $11.74 and $11.94 per share, up from $11.50 to $11.72 earlier.
In Other News
• Suncor Energy Inc: Canada's second-biggest oil producer Suncor Energy will cut 1,500 jobs by the end of this year, aiming to reduce costs and improve its financial performance, the Globe and Mail reported on Thursday, citing details from the Canadian Press. A Suncor spokeswoman confirmed to the Canadian Press that the job cuts would be spread across the organization and would affect both employees and contractors, the Globe and Mail reported. "Suncor is always looking for opportunities to drive value and improve performance in our business, cost reduction is one of those opportunities," Suncor told Reuters, without providing further details on the job cuts.
COLUMN
Hopes of economic ‘soft landing’ re-emerge after stormy descent: Mike Dolan
The economic airplane hasn't reached the runway yet and has hit some more heavy turbulence in 2023 - but investors suspect a relatively gentle touchdown may be back on the cards.
ANALYSTS' RECOMMENDATION
• Lundin Gold Inc: Canaccord Genuity raises target price to C$21 from C$20, expecting the company to ramp up its capital spending from second-quarter onwards.
• Parkland Corp: BMO raises target price to C$40 from C$35, reflecting the company's near-term focus on reducing leverage and optimizing its current business units.
CORPORATE EVENTS (All timings in U.S. Eastern Time)
1000 Jaguar Mining Inc: Annual Shareholders Meeting
EX-DIVIDENDS
Stella-Jones Inc: Amount C$0.23
Suncor Energy Inc: Amount C$0.52
(All analysts' estimates are according to I/B/E/S Refinitiv data)
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