TSX closes flat despite earnings... Valeant to repay debt sooner, profits beat expectations... Hydro One profits hit by milder weather... TV streaming services face extra competition as CBS comes to Canada...
Materials took the shine off some positive stories Tuesday as the Toronto Stock Exchange returned to work after the holiday weekend.
Oil prices ended the session lower as producers increase output despite efforts to cut the supply glut. Although some OPEC members including Saudi Arabia are reducing production, other major producers are offsetting the cuts. Gold prices only saw a slim gain as the US dollar gained.
On the main TSX index, Great Canadian Gaming jumped almost 15% as it was announced that, together with Brookfield Partners, it would run some casinos in Toronto.
The consumer discretionary sector group led gains in 6 TSX sector groups while energy and IT groups dropped more than 1% and utilities and materials posted smaller losses.
Wall Street closed lower over US-North Korea tension. European indexes closed higher while Asian indexes were mixed.
The S&P/TSX Composite Index closed down 1.62 (0.01%)
The Dow Jones closed down 33.08 (0.15%)
Oil is trending lower (Brent $52.06, WTI $49.16 at 4.35pm)
Gold is trending higher (1265.80 at 4.35pm)
The loonie is valued at U$0.7896
Valeant to repay debt sooner, profits beat expectations
Valeant Pharmaceutical has announced better-than-expected quarterly profits driven by strong sales of its IBS drug Xifaxan.
Earnings of $1.07 per share beat analysts’ average expectation of 94 cents according to Reuters. Revenue $2.23 billion was less surprising.
The firm now expects full-year revenue to be slightly below its previous forecast; $8.7 billion to $8.9bn compared to $8.9bn to $9.1bn.
However, it expects to repay around $5 billion of debt earlier than its previous promise of February 2018. The news pushed its shares up 10% Tuesday.
Hydro One profits hit by milder weather
Lower demand for energy due to milder winter weather has cut profits at Hydro One in the second quarter of 2017.
The uncertainty over interest rates also hit revenue which fell 11.3% to $1.37 billion. Net income was down to $117 million (20 cents per diluted share) compared to $152 million (25 cents) a year earlier.
Profits were also affected by higher costs related to storms.
TV streaming services face extra competition as CBS comes to Canada
CBS has announced expansion of its online TV streaming services which will mean increased competition in Canada from next year.
The US broadcaster will roll out its All Access platform globally including a 24/7 news channel, and compete with other services including Bell media’s Crave TV and Netflix Canada.