Morning Money | Wednesday, August 26
What matters this morning: Canada is waking up to two very different signals. The biggest macro risk remains the renewed Canada–U.S. trade fight after Washington imposed 50% tariffs on a range of Canadian goods following the breakdown in talks. At the same time, Canada’s banks continue to show surprising resilience. National Bank beat profit expectations this morning, following strong results from BMO and Scotiabank yesterday — a sign that domestic banking, wealth management and capital-markets activity remain relatively healthy despite the trade uncertainty. Falling oil prices are also easing some inflation and bond-yield pressure, although that can be a headwind for Canada’s energy-heavy market.
Markets & earnings: TSX futures were roughly flat this morning after the index reached a record high yesterday. U.S. futures were also essentially unchanged, with the Dow up about 0.02%, the S&P 500 down 0.02% and the Nasdaq down 0.05%. Brent crude fell close to 3% to around US$86 a barrel on hopes of progress toward reopening the Strait of Hormuz. National Bank reported adjusted earnings of C$3.39 per share versus roughly C$3.22 expected, helped by strong capital-markets and wealth-management results. The biggest event for global markets today is Nvidia earnings, which will be closely watched as a test of whether the AI investment boom still has enough momentum to justify current valuations.
What to watch: U.S. core PCE inflation is expected to come in around 3.3% year over year. Between that inflation reading and Nvidia’s results, today could set the tone for both interest-rate expectations and technology stocks heading into September.
