Retreating more than 150 pips, the Canadian dollar experienced a huge pull back against the US dollar. The correction followed a 1.1 percent appreciation in the Loonie on the release of exceptional retail sales data. Furthermore, with the US dollar greatly oversold, a correction could lead pairs like USD/CAD higher.
Toronto-based grocery store chain Loblaw Companies Ltd. reported lower earnings in its second quarter report. Loblaw?s profit slowed 43 cents a share to $119 million.
Growing from last year?s second quarter earnings of $474-million or 94 cents per share, Petro-Canada printed operating gains of $805-million or $1.63 per share. CEO Ron Brenneman commented, "Our record quarter was due to a strong integrated portfolio, solid operations and a robust business environment."
http://www.canada.com/nationalpost/financialpost/story.html?id=55f45971-769d-4d4e-a570-2a9e7c2552ac&k=55298[I]Source: Financial Times[/I]
Suncor Energy Inc. showed second quarter earnings that were nearly half of the previous year?s quarterly earnings. In order to repair a plant in Alberta, the company stopped production, leading to a reduction in output.
[B]Currency Markets: USDCAD
[/B]Retreating more than 150 pips, the Canadian dollar experienced a huge pull back against the US dollar. The correction followed a 1.1 percent appreciation in the Loonie on the release of exceptional retail sales data. Furthermore, with the US dollar greatly oversold, a correction could lead pairs like USD/CAD higher. Additional damage was inflicted on the Canadian currency as a global downfall in the equity markets instilled fear in carry traders who unloaded their risky positions, causing several higher yielding currencies to fall against the yen. The USDCAD was most recently quoted at1.0516.
[B]Equity Markets: S&P/TSX Index[/B]
After yesterday?s mild rebound, the S&P/TSX index continues its decent from Tuesday?s 400 point loss. The financial sector drove the index with companies such as Royal Bank of Canada down 8.47 percent, Manulife Financial down 7.04 percent, and The Toronto-Dominion Bank down 6.67 percent. Banks such as Toronto Dominion Bank are contributing to large buyouts which investors now worry will be difficult to finance. The S&P/TSX was most recently quoted down 214.37 points, falling bellow the 14,000 mark at 13,890.95.
[B]Fixed Income Markets: Canadian Government 10-Year Bond[/B]
The 10-year government bond rose following a worldwide deflation in equity markets and an increase in demand for credit default swaps. The increased hedging of risk together with a worldwide decline in confidence of equities prompted investors to park their money in risk free government safe havens. The 10-year government bond was most recently trading at 96.240, yielding 4.51 percent.