Daily Wrap-Up: Financials drags as Home Capital slips again

Daily Wrap-Up: Financials drags as Home Capital slips again

Daily Wrap-Up: Financials drags as Home Capital slips again Financials drags as Home Capital slips again
Shares in Home Capital Group continued lower again Friday following a conference call that warned of the lender’s future.

The decline for the lender and other banks meant the financials sector group was one of the weakest performers of the session along with consumer discretionary, energy and healthcare. Six groups ended lower while materials led the slim gains.

Wall Street closed lower as retail stocks remained subdued, although the Nasdaq was up. European indexes closed higher while Asia’s main markets were lower except for mainland China and Hong Kong.

The S&P/TSX Composite Index closed down 12.67 (0.08 per cent)
The Dow Jones closed down 22.81 (0.11 per cent)
Oil is trending higher (Brent $50.88, WTI $47.89 at 4.35pm)
Gold is trending higher (1228.10 at 4.35pm)
The loonie is valued at U$0.7292

Home Capital conference call sets alarm bells ringing
While Home Capital’s quarterly results may have given some hope to investors Thursday, the conference call that followed Friday has set alarm bells ringing.
The group’s stock closed down 13 per cent following comments made by management:

"Management believes that material uncertainty exists regarding the company's future funding capabilities as a result of reputational concerns that may cast significant doubt upon the company's ability to continue as a going concern.”

Meanwhile, Home Trust HISA deposits were expected to fall to $125 million after settlement of the previous day’s transactions.

CIBC merger approved
Shareholders of PrivateBancorp Inc. held a special meeting in Chicago and approved its proposed $6.8 billion merger with CIBC.

Reacting to the news, CIBC’s president and CEO Victor Dodig said the Canadian bank is very pleased with the outcome.

"We are focused on obtaining the remaining regulatory approvals and finalizing our integration plans as we work toward closing the deal in June,” Dodig said. “We look forward to continuing to work closely with the PrivateBancorp team to successfully complete the transaction and realize the full benefits for our shareholders, employees, clients and communities."