Market Analysis: May 21st, 2025
Global Markets
Canadian Markets: Canada's TSX declined, pulling back from record highs , as investors booked profits to mitigate risks amid renewed trade tensions and concerns about slowing global growth. As the markets head into the typically quieter summer months, lower trading volumes may increase volatility. In addition, growing pessimism among economists — with several now forecasting that Canada is heading into a recession — has weighed on investor sentiment. Weakening consumer spending, a cooling housing market, and persistent inflationary pressures are contributing to this negative outlook which are reflecting the current aversion to risk, the despite strength from rising oil and gold.
US Markets: U.S. equity markets traded lower, as Treasury yields surged, reflecting heightened fiscal concerns. Investors are watching Washington's political gridlock, particularly with the ongoing standoff over President Donald Trump's proposed tax-cut legislation, which is reigniting debates about deficit spending. Markets also are addressing the re-escalation in tensions between the U.S. and China over the semiconductor trade, further stoking fears of a renewed 'chip war' that could hurt technology supply chains and global growth.
European Markets: European stock markets traded the day mixed, while some regional indices managed modest gains, as the broader market was dragged down by sharp declines in key stocks like JD Sports and Julius Baer, both of which posted disappointing updates. The performance of these heavyweight stocks overshadowed otherwise stable earnings and economic data across the eurozone.
UK equities rose slightly, despite an unexpected move higher in inflation. Consumer prices in the UK climbed more sharply than forecast in April, driven by a surge in energy and transport costs. The headline inflation rate surpassed 3%, raising fresh concerns for the Bank of England as it considers its next steps on interest rates. The persistence of high inflation, even as economic growth remains modest, complicates the central bank's efforts to bring price pressures under control without stifling demand.
Stock News
Alphabet Inc
Volvo Cars has become the lead development partner for Google's Android Automotive software. This deeper collaboration will allow Volvo customers earlier access to new features, giving it a competitive edge in user experience and software integration.
Apple Inc
Epic Games' Fortnite has returned to Apple's App Store in the U.S. after nearly five years, following a court ruling that found Apple violated antitrust regulations. This marks a significant win for Epic Games in its legal battle with Apple over app payment practices.
Brookfield Asset Management
Spain's Bankinter has submitted a binding bid for Livensa, Brookfield's student housing platform, valued at around €1.2 billion. CPPIB and KKR are also reported to be interested. Brookfield has not commented publicly on the deal.
Canada's Big Banks
Four of the six largest Canadian banks are expected to have each set aside over C$1 billion in Q2 for loan loss provisions, preparing for potential defaults amid economic uncertainty and trade-related risks.
Comcast Corp & Walt Disney Co
Comcast is set to open its $7 billion 'Epic Universe' theme park in Central Florida, expanding Universal Orlando Resort. This major addition challenges Disney World's dominance and includes five themed worlds based on well-known franchises.
ConocoPhillips
Guangdong Pearl River Investment Management Group signed a 15-year LNG supply agreement with ConocoPhillips. Although volumes weren't disclosed, the deal supports China's growing LNG infrastructure and energy needs.
DXC Technology Co
JPMorgan cut its price target to $18 from $22, citing lower free cash flow expectations for FY27 and FY28.
Keysight Technologies
Keysight exceeded Wall Street estimates for Q2 revenue and profit, driven by strong sales in its communications segment. Shares rose 5% after-hours, and the company reported EPS of $1.70 vs. an expected $1.65.
Kraft Heinz Co
Kraft is exploring strategic deals amid falling demand for its premium snack and meal products. Two Berkshire Hathaway executives are exiting the board as Buffett's firm withdraws board participation. Kraft has also lowered its annual sales and profit forecasts.
Lowe's Companies Inc
Lowe's reported a smaller-than-expected 1.7% decline in same-store sales and maintained its 2025 outlook. Despite weak big-ticket sales due to higher interest rates, maintenance spending helped cushion the decline.
Medtronic PLC
Medtronic plans to spin off its diabetes business into a separate company within 18 months. The division, with $2.5 billion in annual sales, will be based in California and led by current diabetes head Que Dallara.
Myriad Genetics Inc
Scotiabank downgraded the stock to 'Sector Perform' from 'Sector Outperform' and cut the price target to $6 from $20, citing a need for clearer strategic direction under new leadership.
Nvidia Corp
CEO Jensen Huang criticized U.S. export controls on AI chips to China as a failure, saying they have cost American firms billions and were based on flawed assumptions. He supports regulatory adjustments by the Trump administration.
Palo Alto Networks
Palo Alto raised its Q4 revenue forecast, driven by increased demand for cybersecurity solutions amid rising digital threats. Analysts see the sector as resilient and poised to benefit from increased AI adoption.
Target Corp
Target slashed its annual forecast after reporting a sharp drop in same-store sales. Executives cited weak consumer confidence and trade uncertainty, including potential tariff impacts from U.S.-China tensions.
Tesla Inc
Tesla will begin testing its robotaxi fleet in Austin, TX by June, starting with 10 vehicles and expanding to 1,000. The rollout comes amid regulatory scrutiny and declining global sales, as well as growing backlash toward Elon Musk's political ties.
Viking Holdings Ltd
JPMorgan raised its price target to $61 from $58 after Viking beat Q1 adjusted EBITDA estimates.
Wolfspeed Inc
Wolfspeed is reportedly preparing for Chapter 11 bankruptcy due to heavy debt and sluggish demand in industrial and auto sectors. Shares fell 57% in extended trading. The firm is seeking creditor support after failed restructuring talks.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
CTV News
15 minutes ago
- CTV News
What it would take to convert a jet from Qatar into Air Force One to safely fly Trump
WASHINGTON — U.S. President Donald Trump really wants to fly on an upgraded Air Force One — but making that happen could depend on whether he's willing to cut corners with security. As government lawyers sort out the legal arrangement for accepting a luxury jet from the Qatari royal family, another crucial conversation is unfolding about modifying the plane so it's safe for the American president. Installing capabilities equivalent to the decades-old 747s now used as Air Force One would almost certainly consign the project to a similar fate as Boeing's replacement initiative, which has been plagued by delays and cost overruns. Air Force Secretary Troy Meink told lawmakers Thursday that those security modifications would cost less than US$400 million but provided no details. Satisfying Trump's desire to use the new plane before the end of his term could require leaving out some of those precautions, however. A White House official said Trump wants the Qatari jet ready as soon as possible while adhering to security standards. The official, who spoke on the condition of anonymity, did not provide details on equipment issues or the timeline. Trump has survived two assassination attempts, and Iran allegedly also plotted to kill him, so he's well aware of the danger he faces. However, he seems willing to take some chances with security, particularly when it comes to communications. For example, he likes to keep his personal phone handy despite the threat of hacks. He boasted this week that the government got the jet 'for free,' saying, 'We need it as Air Force One until the other ones are done.' Here's a look at what it would take to make the Qatari plane into a presidential transport: What makes a plane worthy of being Air Force One? Air Force One is the call sign for any plane that's carrying the president. The first aircraft to get the designation was a propeller-powered C-54 Skymaster, which ferried Franklin D. Roosevelt to the Yalta Conference in 1945. It featured a conference room with a bulletproof window. Things are a lot more complicated these days. Boeing has spent years stripping down and rebuilding two 747s to replace the versions that have carried presidents for more than three decades. The project is slated to cost more than $5.3 billion and may not be finished before Trump leaves office. A 2021 report made public through the Freedom of Information Act outlines the unclassified requirements for the replacement 747s under construction. At the top of the list — survivability and communications. The government decided more than a decade ago that the new planes had to have four engines so they could remain airborne if one or two fail, said Deborah Lee James, who was Air Force secretary at the time. That creates a challenge because 747s are no longer manufactured, which could make spare parts harder to come by. Air Force One also has to have the highest level of classified communications, anti-jamming capabilities and external protections against foreign surveillance, so the president can securely command military forces and nuclear weapons during a national emergency. It's an extremely sensitive and complex system, including video, voice and data transmissions. James said there are anti-missile measures and shielding against radiation or an electromagnetic pulse that could be caused by a nuclear blast. 'The point is, it remains in flight no matter what,' she said. Will Trump want all the security bells and whistles? If the Qatari plane is retrofitted to presidential standards, it could cost $1.5 billion and take years, according to a U.S. official who spoke on the condition of anonymity to provide details that aren't publicly available. Testifying before Congress this week, Meink discounted such estimates, arguing that some of the costs associated with retrofitting the Qatari plane would have been spent anyway as the Air Force moves to build the long-delayed new presidential planes, including buying aircraft for training and to have spares available if needed. In response, Rep. Joe Courtney, D-Conn., said that based on the contract costs for the planes that the Air Force is building, it would cost about $1 billion to strip down the Qatar plane, install encrypted communications, harden its defenses and make other required upgrades. James said simply redoing the wiring means 'you'd have to break that whole thing wide open and almost start from scratch.' Trump, as commander in chief, could waive some of these requirements. He could decide to skip shielding systems from an electromagnetic pulse, leaving his communications more vulnerable in case of a disaster but shaving time off the project. After all, Boeing has already scaled back its original plans for the new 747s. Their range was trimmed by 1,200 nautical miles, and the ability to refuel while airborne was scrapped. Paul Eckloff, a former leader of protection details at the Secret Service, expects the president would get the final say. 'The Secret Service's job is to plan for and mitigate risk,' he said. 'It can never eliminate it.' If Trump does waive some requirements, James said that should be kept under wraps because 'you don't want to advertise to your potential adversaries what the vulnerabilities of this new aircraft might be.' It's unlikely that Trump will want to skimp on the plane's appearance. He keeps a model of a new Air Force One in the Oval Office, complete with a darker color scheme that echoes his personal jet instead of the light blue design that's been used for decades. What happens next? Trump toured the Qatari plane in February when it was parked at an airport near Mar-a-Lago, his Florida resort. Air Force chief of staff Gen. David Allvin was there, too. The U.S. official said the jet needs maintenance but not more than what would be expected of a four-engine plane of its complexity. Sen. Tammy Duckworth, an Illinois Democrat on the Senate Armed Services Committee, said it would be irresponsible to put the president and national security equipment aboard the Qatari plane 'without knowing that the aircraft is fully capable of withstanding a nuclear attack.' 'It's a waste of taxpayer dollars,' she said. Meanwhile, Boeing's project has been hampered by stress corrosion cracks on the planes and excessive noise in the cabins from the decompression system, among other issues that have delayed delivery, according to a Government Accountability Office report released last year. Boeing referred questions to the U.S. Air Force, which said in a statement that it's working with the aircraft manufacturer to find ways to accelerate the delivery of at least one of the 747s. Even so, the aircraft will have to be tested and flown in real-world conditions to ensure no other issues. James said it remains to be seen how Trump would handle any of those challenges. 'The normal course of business would say there could be delays in certifications,' she said. 'But things seem to get waived these days when the president wants it.' AP writer Lolita C. Baldor in Washington contributed to this report. Tara Copp And Chris Megerian, The Associated Press
CTV News
15 minutes ago
- CTV News
Bank of Canada head Tiff Macklem says mandate should evolve in a ‘shock-prone' world
Bank of Canada Governor Tiff Macklem takes part in an interview at the Bank of Canada in Ottawa on Wednesday, June 4, 2025. THE CANADIAN PRESS/Sean Kilpatrick OTTAWA — Tiff Macklem is wearing an Edmonton Oilers pin as he reflects on coming very close to beating big odds. It's a significant day for the governor of the Bank of Canada: he's just laid out his reasons to the entire country and a global audience for keeping the central bank's benchmark interest rate steady for a second straight time. That night is also Game 1 of the NHL's Stanley Cup finals; Macklem ends his press conference with a hearty 'Go Oilers!' It's a rematch from last year's heartbreak, when the Oilers came oh-so-close to mounting a seemingly impossible four-game comeback against the Florida Panthers, only to fall short by a single goal in Game 7. Macklem, too, was almost safe to declare victory last year. He had just about secured a coveted 'soft landing' for Canada's economy — a rare feat that sees restrictive monetary policy bring down surging levels of inflation without tipping the economy into a prolonged downturn. 'We got inflation down. We didn't cause a recession,' Macklem said in an interview with The Canadian Press after the rate announcement Wednesday. 'And, to be frank, until President (Donald) Trump started threatening the economy with new tariffs, we were actually seeing growth pick up.' Fresh out of one crisis, the central bank now must contend with another in U.S. tariffs. Five years into his tenure as head of the Bank of Canada, Macklem said he sees the central bank's role in stickhandling the economy — as well as Canada's role on the world stage — evolving. Many Canadians have become more familiar with the Bank of Canada in recent years. After the COVID-19 pandemic recovery ignited inflation, the central bank's rapid tightening cycle and subsequent rate cuts were top-line news for anxious Canadians stressed about rising prices and borrowing costs. That was all in pursuit of meeting the central bank's inflation target of two per cent, part of a mandate from the federal government that's up for review next year. Macklem said the past few years have led the Bank of Canada to scrutinize some of its metrics, like core inflation and how it responds to supply shocks in the economy. But he defends keeping the bank's inflation target, particularly at a time of global upheaval. 'Our flexible inflation targeting framework has just been through the biggest test it's ever had in the 30 years since we announced the inflation target,' he said. 'I'm not going to pretend it's been an easy few years for anybody. But I think the framework has performed well.' Macklem said, however, that he sees room to build out the mandate to address other areas of concern from Canadians, such as housing affordability. Whether it's the high cost of rent or a mortgage, or surging prices for groceries and vehicles, Macklem said the past few years have been eye-opening to Canadians who weren't around the last time inflation hit double digits in the 1980s. 'Unfortunately, a whole new generation of Canadians now know what inflation feels like, and they didn't like it one bit,' he said. Monetary policy itself can't make homes more affordable, he noted — in a nutshell, high interest rates make mortgages more expensive while low rates can push up the price of housing itself because they stoke demand. But Macklem said one of the things he's reflecting on is that inflation can get worse when the economy isn't operating at its potential or when it's facing great disruption. 'There is a role for monetary policy to smooth out some of that adjustment — support the economy while ensuring that inflation is well-controlled.' He didn't offer suggestions on how the mandate might expand to address housing affordability specifically, but said 'the work is ongoing' and will be settled in meetings with the federal government next year. Right now, he's trying to make sure that the economic impacts from Canada's tariff dispute with the United States don't result in prolonged inflation. The Bank of Canada is not alone in debating how monetary policy ought to respond in what Macklem called a more 'shock-prone' world. The G7 Finance Ministers' Summit in Kananaskis, Alta., last month also featured roundtables with the bloc's central bankers. Conversations at the summit were 'candid,' Macklem said, and though the nations issued a joint statement at the close of the event, that doesn't mean they agreed on everything. 'International co-operation, to be honest, has never been easy. It is particularly difficult right now, but that doesn't make it less important. That makes it more important,' he said. 'I do think Canada, as the chair of the G7, has a leadership role to play.' The Bank of Canada is also changing the way it has conversations with Canadians and the kind of data it considers. A day after the June interest rate decision, deputy governor Sharon Kozicki told a Toronto business crowd how the central bank is using data more nimbly, relying heavily on surveys and more granular information to make monetary policy decisions in an uncertain time. These sources offer a faster way to see what's happening on the ground in the economy than traditional statistical models allow. Macklem said the central bank would previously have dismissed most supply shocks as transitory — likely to pass without the need for central bank adjustments, such as rising and falling oil prices. But he said the Bank of Canada needs to be running a more 'nuanced playbook' now to respond to some increasingly common shocks: supply chain disruptions, trade conflicts and extreme weather to name a few. An overheating economy running up against a supply disruption is the kind of inflationary fire Macklem is trying to avoid in this latest crisis. 'The economy does not work well when inflation is high,' he said. 'And the primary role of the Bank of Canada is to ensure that Canadians maintain confidence in price stability. That's all we can do for the Canadian economy. That's what we can do for Canadians. And that's what we're focused on.' Later in the day on Wednesday, the Edmonton Oilers took Game 1 of the Stanley Cup finals. The Canadian team was down but roared back to win 4-3 in overtime. It's still early in the Bank of Canada's response to the latest global shock. But with any luck, Macklem's team might also get a leg up with lessons learned the last time they faced big odds. This report by The Canadian Press was first published June 7, 2025. Craig Lord, The Canadian Press
Toronto Star
16 minutes ago
- Toronto Star
As his trade war faces legal pushback, Trump has other tariff tools he could deploy
WASHINGTON - U.S. President Donald Trump's tariffs are facing legal headwinds for the first time — but he has other tools he could deploy in his quest to realign global trade. A federal appeals court is still deciding whether there will be a stay on Trump's universal tariffs enacted through the International Emergency Economic Powers Act of 1977, usually referred to by the acronym IEEPA. The U.S. Court of International Trade ruled the duties were unlawful last month.
