The Canadian dollar charged forward on the release of exceptional retail sales, harvesting almost 100 pips. Loonie bulls prevailed as the 2.8 percent retail sales print blew past the 0.5 percent projection to target fresh 30 year highs. With economic indicators continuing to show untamed inflation, the Bank of Canada may need to tighten further.
Canadian Pacific Railway Ltd. posted a 7 percent increase in revenues led by higher shipments of sulphur, fertilizer and coal. CEO Fred Green mentioned the high second quarter growth in revenue came despite "A 26-day strike and tough weather-related operating conditions."
http://www.cbc.ca/money/story/2007/07/24/cprearns.html
[I]Source: CBC[/I]
Canadian retail sales soared over its 0.5 percent expectations, printing a robust 2.8 percent growth. Retail sales were driven by strong automobile sales and by a pay settlement in Quebec with public service workers.
http://www.canada.com/nationalpost/financialpost/story.html?id=616134ae-5aac-4a36-94a2-88ac65a73c92&k=79581
[I]Source: Financial Post[/I]
Ontario Teachers’ Pension Plan Board offered to buy 15 percent of non-voting shares in Brazilian mining company LLX Logistica SA for $185 million. The deal is awaiting the consent of company’s board and LLX shareholders.
http://www.bloomberg.com/apps/news?pid=20601082&sid=a8b6R5My03Hc&refer=canada
[I]Source: Bloomberg[/I]
[B]Currency Markets: USDCAD[/B]
The Canadian dollar charged forward on the release of exceptional retail sales, harvesting almost 100 pips. Loonie bulls prevailed as the 2.8 percent retail sales print blew past the 0.5 percent projection to target fresh 30 year highs. With economic indicators continuing to show untamed inflation, the Bank of Canada may need to tighten further. Hawkish speculation circling the Bank of Canada continues to drive the Canadian dollar closer to parity with the US dollar. The Canadian dollar was most recently quoted at 1.0370 against the greenback.
[B]Equity Markets: S&P/TSX Index
[/B]The S&P/TSX index got pounded with second quarter earnings reports, leaving it down over 200 points. Canada?s two largest railroad companies, Canadian National Railway Co. and Canadian Pacific Railway Ltd., reported second-quarter losses of 32 percent and 29 percent respectively. Canadian National was down $2.87 at $57.53 while Canadian Pacific dropped $2.10 to $84.63. The S&P/TSX was most recently quoted down 201.74 points at 14,266.59.
[B]Fixed Income Markets: The Canadian Government 10-Year Bond[/B]
Showing multi-market implications, retail sales propelled yields higher. With retail sales bolstering hawkish sentiment, investors increased their bets on a rate hike as reflected in the interest rate futures market. The yield was restrained from higher levels by investors looking for shelter from the worldwide falling equities markets. The 10-year government bond was most recently traded at 95.675, yielding 4.59 percent.
