BNN - Monday, May 27, 2024 - 11:00 a.m. (ET) - Segment #1

>> We move through the open. Let's get you up to speed on the morning markets. And on a quiet trading day with the spotlight on canadian action, the tsx getting more than 50 points at this hour. Coming up, we'll dive deeper into the story of the equity markets here in this country were also take a deeper look at how confident consumers in this country are feeling right now when it comes to what they're willing to spend and speaking of spending, the price of homes these days is driving a lot of young canadians outside of big cities will break down the numbers coming up as well. But let's get to some of the other stories we're tracking in our bnn bloomberg newsroom. China has hit back at g7 nations that have criticized beijing's global trade practices. Their message over the weekend accusing china of hurting the economies of its trade partners. In response, a top chinese official dismissing those claims, calling them. Protectionist move in an attempt to set obstacles limitations to china's progress. Shareholders of indigo are set to vote this morning on whether the retailer should accept a sweetened offer to take the bookstore chain private. The $2.50 per share bid comes from 2 firms controlled by gerry schwartz, the husband of indigo ceo heather e spent. The offer already has the support of a special committee of independent directors elon musk's ai startup x ai has re 6 billion dollars to. Fast forward. Its challenge to its former allies open ai. The financing round comes less than a year after exe eyes debut. Musk had been an early supporter of ai and what was one of the original backers of that company. He later withdrew his support from the venture has advocated caution because the technology has potential dangers. Looking at the markets today, the tsx getting most of the attention with holiday weekend in the united states. Keeping things pretty quiet in new york. 50 points higher at this hour, 3 tenths of a percent gain. Most of groups in toronto are currently in the green. We've got oil prices trending higher at this hour. Up $0.76, the best performing subgroup has been the materials. Sector led by gold stocks with bullion up almost one percent on the day. Our canadian dollar is a bit stronger against the greenback at 73 34 and moving from fiat currencies to digital currencies. Bitcoin right now is up close to one and a half percent. And a which has been getting a lot of attention recently on excitement around possible theory, an etf. Some new york is currently up more than 2%. (Upbeat electronic music) okay. Well, we are watching the tsx this morning with most of the focus on the canadian market as the U.S. holiday has a kept things quiet in new york, but it's a good starting point, given the fact that the canadian market after a bit choppiness last week is returning to its winning ways. Granderson is vice president, head of portfolio management with capital and he joins us here in studio. Nice to see you. Good it is does feel like a nice opportunity to talk about canadian equities, which have been playing catch-up. It a lot of ways us. What what's been your sense of the canadian market story? Well, first of all, I mean, has been valuations than the U.S. market valuations to nothing over the next week, month year fight to have to almost go 5, 7 years. Start to have some statistical significance. >> Having said that, we have a market, the constituents which are quite to from the u.s., particularly when you look at the sectors, the firm inflation protection, that still means a little than issue still haven't materials, as you just mentioned, you know, particularly on the gold that some of the world that whether that will pay its catch up. And then you got your more interest rate sensitive large in the financials, larsen utilities large in the reits, you know, compared to the U.S. in particular. >> When you look at all of those options in the market right now. Do you are, are you constructi on many of them? We saw a constructive on the canadian marketplace. You know, you go to the U.S. marketplace for growth and that's certainly what we've got. Markham place, the underlying dynamics. You don't have as much in terms of earnings growth is you have there. We get a little bit

more of an income focus, perhaps talks friendly as deferred capital gains that come with with the the growth. But we have tax advantages for here. So yes, constricted canadian, it's less expensive. We've got good sector considerations. If you're taking the country, where what part of market still beaten up. And we come back from where they were, they were beaten up 6 months ago. Really real assets and that would be published a real state of infrastructure. That's really where the places that remain beaten-up industrials have done relatively well. So that's, that's really the last year. Consumers, you know, discretionary. And sickle both. Also we will as of the end of the day. We're coming to the end of may and may has winning month for stocks. So that's kind of pouring a little cold water on sell in may. >> And I think there's a lot of dynamics that investors have liked about investing in stocks. And so I guess my my broader question is, does anything break that as we move through the year? People are still fussed about inflation. And yes, that makes sense. Is there a chance that that really is back up? I would just pull the tablecloth from youth the market without a doubt. You know, call 3, 3, in a bid for says to be a target. It's come a long way. So is the genie in the bottle are back in no, not quite yet. You kind of put a lower probably toward that being thing that sets it, get into geopolitical risks. There's obviously a handful out there. Like undermine market confidence. And it's interesting go back in history. You could almost have the same event happen when the markets happy. Just gets by. Another moment in time. That same type of event just since the market off into correction of, you know, a 10%. Those are large unpredictable when it comes to the timing, the severe t the reaction there, too. So we always look at them. But you can go, how do you trade around pretty hard. You trade around that's really when happened and you feel the market's been over, punished, then do you have the courage to for be the contrarian investor and dive on the okay. Let's dive into the banking sector in this country because we're going to get earnings from the lion share. The canadian banks this week. Do you like that sector? Yes, we do. I mean. Liked it a little bit more 6 months ago, when you're looking at the yields that were just quite simply harder than you are today. Valuations. We're that much robust really the premise back then was with a little losses are going to come shooting through recession was on the horizon and they got big down according well, that's been pushed off. So to have interest rate cuts. But I pushed off. So come back up. Take a look where they're trading versus their, you know, media analyst target fairly close. Yes. At the there are no doubt flee. They got the ability to produce, you know, cash flow. They're not just in canada. Thing sometime chains forget that they're really more global banks or at least the majority of them. A lot of exposure down to the state's down into south america, the caribbean. So it's really a play more. Yes, large of the canadian consumer and corporations, but also more beyond our borders as well. So yes, constructive. A story that is beyond our borders as well as renewable energy. It's been a big theme. We've got a lot of attention on it right now in the market, it's a sector. The you're watching 2, 0, absolutely. I mean, this thing and we talk about the build have further comeback coming since april, when things are running high for 2 pickle to particular is we can come to. But when you take a look at their former and how badly they've trailed the general market composite, they're still likely room to run there. It's not just predicated on lower interest rates will have fixed project financing. Now not 100% by stretch, the imagination. But when you take take a look at what. Fostered it. Well, it's like a waterfall. It was all revved up on the ai thing. And now we take a look at s&p 500 call transcripts. You I full tournament every single call right. So it's now broadening out and to no great surprise, people really realizing things are energy hogs and how you're going to feed that beast than they are and that they want to do with renewable. And again, folks tend to think about renewables hats. You know, producers to governments while that microsoft deal with brookfield show reminded folks there's also renewable producers to corporations. So let's talk a little bit about that because it gets into some of the investment ideas you have right now, including brookfield, renewable. So they have a a collaboration with microsoft. Yes. And so over the next 5 years to increase their capacity by about so it's a massive deal. Seems like a 3rd to a 4th of their current capacity. So it's not

insignificant. It also starts, I mean, its largest deal ever done like this is a 5 year term, its wind and solar and kind parties to be named later. They left sobey interest to see what they explore. We take a look at brookfield they're very diversified. They're one of the cornerstones of in reno will portfolio like to invest in it because you get your hydro, you get when you get your solar, you get your battery. They distributed energy. So you get and you geographical diversification, not just canada is not us want exposure to emerging market good presence in india and down in south america. So the end they have access to capital has still often invest through. Funds and limited partnership. So they've got lots of partners are investing with some flexibility in terms of raising capital go and take the next contrarian like they did with westinghouse when they teamed with but west oso. And within our party secure last up. Oh, look at that fight. The nuclear side of that council 5%. The fund from operation. So it's like option, if you will, not that nuclear resurgence. We're almost at the time. But by comparison, boralex is another name in that group. The eu also feel after that microsoft notice ran higher. It's not as all-time high more lex has run, but not as far so perhaps has more upside. It's a younger, you know, smaller player and they're looking to spread out and diversify their revenue streams as well. All right, it's going to great to get your perspectives as always. Thanks very much and have a great day. Thank you, arn anderson joining us, vice president and head of portfolio management at tacit capital will take a quick break. When we come back. We're waiting for a key vote on indigo going private will get the latest details next. Morning Markets is brought to you by Amur Capital. Discover Amur Capital a simpler approach to investing. Discover amur capital. Amur capital's track record of consistent performance has delivered industry leading returns since inception. Why play games with your financial future? Choose amur capital - a Simpler Approach to Investing. With a focus on a clean future. Hertz energy offers investors a diversified portfolio of district scale uranium and lithium assets. The company has projects around the globe, including the world class James Bay Lithium District in Quebec. Hertz projects are located in highly prospective geological formations and near other large discoveries. Hertz energy is well positioned for the ever expanding global green energy market. Hertz Energy, powering the future. At the cse, we're always invested in public markets, in business, in growth, in you. Get more from trusted us Treasuries with hbnd. Canada's first covered call bond etf providing attractive monthly income with the strength and security of U.S. government bonds. Hbnd, more income, every month, from Hamilton ETFs. We were born from a deep desire to create positive change, together. One-hundred-fifteen years later, that impact is felt everywhere. It's where we've made innovations accessible to those who need it most. Where we've championed truth and justice... for all. Where we've mapped out futures... we're already living. From here to here and even here. We're not just transforming lives. We're shaping the world. - [Narrator] The Ninepoint Energy Fund managed by Eric Nuttall. Generating long-term alpha in the energy sector through conviction and access. Number one Energy Fund in the Morningstar energy equity fund category for 3, 5, 10, and 15-year performance. Available under ticker nnrg. (Upbeat music) but one of the stories we're tracking this morning is indigo. And whether or not we will ultimately see. >> The. >> Company officially go private. We're awaiting a key vote on that this morning in bloomberg's divya balji has been tracking that story along with some others. She's actually joining us from sao paulo today. So good to here in canada, we're watching this indigo privatization plan. Divya, what's been the at bloomberg over over this, transaction. >> Yeah, I think really the question that everyone wants answered at this point is it is still going to go through our shareholders going to vote for you know, sweetened bid

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