The Daily Chase: Market rally hits a wall; the economy is the priority of Canadians

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The record-breaking stock rally hits a wall this morning amid growing concerns over COVID-19 variants. Traditional safe havens seen as gold and the 10-year US Treasury (price, not yield – that’s less than 1.3 percent) are among the few major assets that are out of the water early on. of sitting. The Canadian dollar, on the other hand, has fallen below US $ 80 cents for the first time since April as oil is poised to drop below US $ 70 per barrel.

We’re going to be collecting information to see if it’s just a hiatus or something that’s going to go on and on. And we can’t wait to get a better idea of ​​what’s going on behind the scenes when BMO Capital Markets CEO Dan Barclay joins us at 2:30 p.m.

IT’S THE ECONOMY …

Based on the parade of campaign-style announcements of late, it seems it’s only a matter of time before an election is called. And a new Nanos Research poll for CTV News shows the economy is the top priority for Canadians: 28 percent say it’s the most important political issue, compared to 17 percent for the environment (COVID- 19 is fifth on the ranking issues list). We’ll have a perspective shortly after 9 a.m. when CTV News Ottawa bureau chief Joyce Napier joins Jon on The Open.

CENTRAL BANKS FIGHT AGAINST INFLATION

Yesterday was the US Federal Reserve in the spotlight with the minutes of its latest policy-making meeting highlighting the challenge the central bank faces in making sense of the outlook. “Some participants felt that the incoming data provided a less clear signal on the underlying economic dynamics and felt that the Committee would have information in the coming months to better assess the development of the labor market and the economy. inflation, “according to last month’s meeting summary. Today, the European Central Bank is making the headlines by unveiling what it calls a “symmetrical” target of reaching 2% inflation in the medium term. Previously, the ECB targeted inflation “lower but close to 2% in the medium term”. And keep in mind that over the next few months, we’ll know whether the Bank of Canada’s inflation target will be extended or adjusted. This is all a bit wobbly, but the consequences are far-reaching for consumers and the markets.

OTHER SIGNIFICANT STORIES

  • British Columbia lost its blue chip credit rating after S&P reduced the province’s debt to AA + from AAA while highlighting the cost of containing COVID-19. In a report released late yesterday afternoon, the agency said the province’s deficit and debt had reached levels “inconsistent” with an AAA rating.
  • Centerra Gold is increasingly fueling its dispute with Kyrgyzstan over the expropriation of its Kumtor mine. The company now claims that Kyrgyzaltyn JSC (described by Centerra as a “gold refining monopoly)” conspired “with the government to take control of the mine.
  • Big Tech faces another antitrust challenge: Google is being sued by 36 US attorneys general for allegedly anti-competitive practices related to its Google Play app store.
  • Dye & Durham is back with some mergers and acquisitions this morning. He announced that he was buying real estate specialist TM Group (UK) Limited for $ 156 million in cash.
  • Descartes Systems also announced an agreement this morning. The Waterloo, Ont. Logistics expert is purchasing GreenMile (which caters to the food and beverage industry) for up to $ 40 million.
  • Canadian entrepreneur Michele Romanow brought one of the world’s foremost tech financiers to her corner with news this morning that Softbank has led a $ 215 million round of funding from Clearco.

NOTABLE OUTPUTS / EVENTS

  • Notable data: initial jobless claims in the United States
  • 7:00 am: the European Central Bank publishes the results of its strategy review (plus 8:30 am briefing by ECB President Christine Lagarde)
  • 9 a.m .: Parliamentary Budget Officer issues cost note “Extending Temporary Work-Sharing Program Improvements for Employers and Employees Affected by COVID-19”
  • 1:00 p.m. Prime Minister Justin Trudeau makes an announcement in Coquitlam, BC, alongside Prime Minister John Horgan (no longer available)


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