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Today’s top headlines
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10:15 a.m.
TD Bank hit with proposed class action over employee pay
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The lawsuit, served to TD on Oct. 6, alleges the bank failed to properly pay vacation or public holiday pay on top of the set commissions and other non-salary compensation earned by more than 1,000 of its mobile mortgage specialists over various years.
The statement of claim seeks total damages of up to $500 million. The allegations in the claim have not been tested or proven in court.
Toronto-based lawyers from Roy O’Connor LLP, Cavalluzzo LLP and Whitten & Lublin PC are representing lead plaintiff Jason Chiang, a mobile mortgage specialist who spent nearly 13 years working for TD in Vancouver.
“We will be bringing a motion to request that this case be certified for this class of employees and, if it is certified, a court will subsequently consider and evaluate the issues alleged in the claim,” the lawyers said in a press release Oct. 10.
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On Jan. 5, CIBC agreed to pay out a total of $153 million to compensate about 30,000 current and former front-line retail staff for alleged unpaid overtime, lawyers involved in the settlement said. The amount included legal fees and the cost of distributing the settlement funds.
Denise Paglinawan, Financial Post
10 a.m.
Stock markets are open: TSX, U.S. stocks head higher
North American stock markets are following global markets higher at the opening bell on some potentially encouraging news about interest rates, which have been dragging markets lower since the summer.
In Canada, the S&P/TSX composite index jumped 210.60 points to 19,456.67 at 10 a.m.
On Wall Street, the S&P 500 was up 17.47 points to 4,353.13, the Dow Jones industrial was up 68.61 points to 33,673.26 and the Nasdaq rose 67.63 points to 13,551.87.
The Associated Press, Financial Post
9:30 a.m.
Scotiabank, Sun Life reach deal to let wealthy clients invest in private credit
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The partnership is the latest example of banks finding ways to break into the hot market for private-credit investments. Last month, Wells Fargo & Co. teamed up with Centerbridge Partners on a private-debt fund targeting at least US$5 billion, Societe Generale SA announced a partnership with Brookfield Asset Management Ltd. and Deutsche Bank AG launched a new investment manager focused on private-credit opportunities.
“Once the domain of the most sophisticated institutional investors, private alternative investments have been increasingly sought after for their important role in enhancing portfolio diversification and risk-adjusted returns,” Glen Gowland, Scotiabank’s group head of global wealth management, said in a statement.
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Banks are also on the hunt for greater fees from high-net-worth clients as they face uncertain revenue streams in other businesses, such as trading. Scotiabank chief executive Scott Thomson said at a conference in September that he wants to “double down” on the lender’s wealth-management business. It’s the third-largest in Canada, with $631 billion in assets under administration globally as of July 31, but it lacks a United States presence, unlike its other large domestic competitors.
Thomson, who took over as CEO in February and plans to unveil a refreshed strategy for the bank in December, recently hired Royal Bank of Canada executive Jacqui Allard to lead Scotiabank’s wealth-management business. She will take over at the beginning of the year from Gowland, who will move to a vice-chair role.
Christine Dobby, Bloomberg
7:30 a.m.
IMF cuts global growth on high interest rates, geopolitical rifts
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By comparison, the United States economy is now expected to grow 2.1 per cent this year and 1.5 per cent in 2024, both of which are higher than the IMF’s earlier projections. Overall, the world’s advanced economies are expected to grow 1.5 per cent in 2023 and 1.4 per cent in 2024. “About 90 per cent of advanced economies are projected to see lower growth in 2023,” the IMF said in its World Economic Outlook released Oct. 10.
The deceleration comes at a time when the world has yet to fully mend from a devastating but short-lived COVID-19 recession in 2020 and now could see fallout from the Middle East conflict, particularly to oil prices.
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A series of previous shocks, including the pandemic and Russia’s war in Ukraine, has slashed worldwide economic output by about US$3.7 trillion over the past three years compared with pre-COVID trends.
“The global economy is limping along, not sprinting,” IMF chief economist Pierre-Olivier Gourinchas said at a news conference during the organization’s annual meeting in Marrakech, Morocco.
The IMF expectation of three per cent growth this year is down from 3.5 per cent in 2022 but unchanged from its July projections.
So far, the world economy has displayed “remarkable resiliency,” Gourinchas said, at a time when the United States Federal Reserve and other central banks worldwide have aggressively raised interest rates to combat a resurgence in inflation.
The hikes have helped ease price pressures without putting many people out of work. That combination, he said, is “increasingly consistent” with a so-called soft landing — the idea that inflation can be contained without causing a recession.
The IMF sees global consumer price inflation dropping from 8.7 per cent in 2022 to 6.9 per cent this year and 5.8 per cent in 2024.
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The Associated Press
Unifor workers kick off strike at GM plants
In a message on the union’s website, Unifor national president, Lana Payne says the bargaining team announced the move, affecting all unionized GM members at the Oshawa Assembly Complex and CCA Stamped Products, the St. Catharines Powertrain Plant and the Woodstock Parts Distribution Centre.
Her statement goes on to blame the strike on the company’s unwillingness to agree on the union’s pattern-bargaining demands on pensions and other supports for those retiring. She says there are also unresolved differences when it comes to making sure temporary part-time workers are given a clear path to permanent employment.
The strike includes approximately 4,280 autoworkers from Locals 222, 199 and 636.
Unifor Local 88 members at the CAMI Assembly Plant in Ingersoll, Ontario are covered by a separate collective agreement and will continue operations.
Officials say its members will remain on strike until the union’s pattern agreement, as established in the ratified collective agreement with Ford Motor Co. of Canada, is met.
General Motors issued an early morning statement via social media, saying “While we have made very positive progress on several key priorities, we are disappointed that we were not able to achieve a new collective agreement.” The statement also notes GM’s willingness to stay at the bargaining table.
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Stock markets: Before the opening bell
Shares climbed Tuesday in Europe and Asia after Wall Street advanced on potentially encouraging news about interest rates, which have been dragging markets lower since the summer.
Fuelled by optimism over a respite from rising interest rates, Germany’s DAX jumped 1.6 per cent to 15,375.23 and the CAC 40 in Paris was up 1.4 per cent to 7,117.90. Britain’s FTSE 100 gained 1.5 per cent to 7,604.40.
The futures for the S&P 500 and the Dow Jones industrial average edged 0.2 per cent higher. On Monday, the S&P 500 gained 0.6 per cent, flipping from losses to gains after two United States Federal Reserve officials suggested interest rates might remain steady at their next policy meeting because a jump in longer-term bond yields may be helping to cool inflation without further market-rattling hikes by the Fed.
The Dow gained 0.6 per cent and the Nasdaq composite climbed 0.4 per cent.
The Associated Press
What to watch today
MTY Food Group will release its earnings results this morning.
The United States will release data on wholesale trade for August.
Additional reporting by The Canadian Press, Associated Press and Bloomberg
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