Today’s news: Trending business stories for December 8, 2023

Article content

Today’s top headlines

Article content

9:41 a.m.

Canada Western Bank hikes dividend as profit rises

Article content

CWB Financial Group raised its dividend as it reported its fourth-quarter profit rose compared with a year ago.

The Edmonton-based bank says it will pay a quarterly dividend of 34 cents per share, an increase of a penny.

The higher payment to shareholders came as CWB says its common shareholders’ net income totalled $76.8 million or 80 cents per diluted share for the quarter ended Oct. 31, up from $67.7 million or 72 cents per diluted share a year earlier.

Revenue totalled $291.8 million, up from $279.8 million in the same quarter last year.

CWB reported a provision for credit losses of $9.8 million for its fourth quarter compared with $12.2 million in the same quarter a year ago.

On an adjusted basis, CWB says it earned 94 cents per share in its latest quarter, up from an adjusted profit of 88 cents per share a year earlier.

“We expect to maintain strong financial results in fiscal 2024 against continued volatility in economic and market conditions,” CWB chief executive Chris Fowler said in statement.

“Our outlook is supported by an increase in our operational efficiency from the reorganization initiatives we executed late this quarter, which will result in the redeployment of resources to priority activities consistent with our differentiated strategy.”

Article content

Article content

The Canadian Press

9:03 a.m.

Sturdy U.S. jobs numbers hint at elusive ‘soft landing’

Employers in the United States added a solid 199,000 jobs last month and the unemployment rate fell, fresh signs that the economy could achieve an elusive “soft landing,” in which inflation would return to the U.S. Federal Reserve’s two per cent target without causing a steep recession.

Friday’s report from the U.S. Labor Department showed that the unemployment rate dropped from 3.9 per cent to 3.7 per cent, not far above a five-decade low of 3.4 per cent in April.

The November job gain was a reminder that many employers continue to hire, though last month’s increase was inflated by the return of about 40,000 formerly striking auto workers and actors, who were not at work in October but returned in November.

Still, the job market is gradually decelerating along the lines that Fed officials have wanted to see. The Fed has raised its key short-term rate from near zero to about 5.4 per cent, a 22-year peak, leading to higher borrowing rates for consumers and businesses and lower inflation. Despite that headwind, the economy and the job market are still expanding. Layoffs remain historically low.

Article content

When the Fed meets next week, it is considered sure to keep its benchmark rate unchanged for the third straight time in light of the easing inflation pressures.
Most economists and Wall Street traders think the Fed’s next move will be to cut rates, though that might not happen until the second half of 2024.

Even modest hiring helps ensure that consumers, who drive most of the economy’s growth, keep spending. Early reports on holiday shopping showed healthy growth in online sales.

The Associated Press

7:30 a.m.

Lululemon shares slip as guidance disappoints

Lululemon Athletica Inc.’s shares slipped in pre-market trade today after fourth-quarter revenue guidance trailed Wall Street estimates, a rare miss for the retailer whose performance routinely exceeds investor expectations.

Sales growth at the activewear company, while still robust compared with most peers, is slowing as higher-income shoppers spend more on things like travel and entertainment rather than apparel. Lululemon said Thursday that revenue in the holiday quarter is expected to be up 13 per cent to 14 per cent over last year, down from 19 per cent growth seen in the three-month period that just ended.

Article content

Shares were down almost 3 per cent in pre-market. The stock’s strong performance this year — more than double the gain of the S&P 500 Index — has increased pressure for the company to keep up its pace of growth.

The retailer forecast fourth-quarter revenue in the range of $3.14 billion to $3.17 billion, while analysts surveyed by Bloomberg were looking for $3.18 billion, on average.

Read more 

— Bloomberg

Stock markets before the opening bell

Stocks are steady today as trader await the pivotal U.S. jobs report out before the bell. The nonfarm payroll report is crucial for traders evaluating whether bets on Federal Reserve policy easing next year are justified — or have gone too far.

U.S. futures were flat this morning after big tech stock helped lift markets on Thursday. Canada’s S&P/TSX composite index closed up yesterday 4.30 points at 20,278.51.

Oil is rebounding but remains on track for the longest weekly losing streak since 2018. Traders are concerned about a global glut of crude and doubtful that deeper supply cuts by OPEC+ will do the trick. West Texas Intermediate approached US$71 after retreating by 11 per cent over the past six sessions.

Article content

What to watch today

• Markets are waiting for the November jobs report from the United States out at 8:30 a.m. ET for clues on where the economy and the Federal Reserve are headed. The report is expected to show that the U.S. gained 172,500 jobs last month, slightly more than October’s gain of 150,000. That number though will be inflated by the return of United Auto Works and Hollywood actors whose strikes ended in October. What investors want to see is evidence that the labour market is cooling fast enough for the Federal Reserve to cut rates in the new year as much as markets expect.

• In Canada, Peter Routledge, superintendent of financial institutions, will make an announcement regarding the level of the Domestic Stability Buffer, the amount of capital Canada’s banks are required to hold as buffer against financial risks.
• In Alberta, finance minister Nate Horner and former provincial treasurer Jim Dinning, chair of a public engagement panel into the possibility of Alberta forming its own pension plan, will hold a news conference.

Need a refresher on yesterday’s top headlines? Get caught up here.

Additional reporting by The Canadian Press, Associated Press and Bloomberg

Article content