BNN - Thursday, May 23, 2024 - 03:00 p.m. (ET) - Segment #3

>>> THANK YOU VERY MUCH INDEED FOR WATCHING "COMMODITIES" TODAY. WE LOVE TO HEAR FROM YOU. COMMODITIES@BNNBLOOMBERG.CA IS THE EMAIL ADDRESS. I AM ON TWITTER, AKA X @ANDREWBELLBNN. HAVE A GREAT DAY. "COMMODITIES" WILL COME BACK TUESDAY OF NEXT WEEK. [ ] At the CSE, we're always invested in public markets, in business, in growth, in you. - [Narrator] The Ninepoint Web3 Innovators Fund. Get exposure to digital assets and to innovative companies leveraging Web3 technologies today. The Ninepoint Web3 Innovators Fund. Available on the TSX, ticker TKN. Ninepoint. ( )( ) ( ) ( ) ( ) True wealth is having peace of mind. At Invico Capital Corporation, our Invico Diversified Income Fund has provided a decade of positive performance. What could you gain by investing in one of Canada's leading alternative income funds. Invico, reach for the future. Champion Iron offers a rare solution to decarbonize the steel industry. Which represents up to 10% of global emissions. The company recently doubled production capacity at its mine in eastern Canada. It is now investing to produce one of the world's purest iron ore. Enabling green steelmaking without the use of coal. Controlling a large portfolio of high purity iron ore resources. Champion is considering strategic partnerships to further develop the region. Champion Iron. At the CSE, we're always invested in public markets, in business, in growth, in you. (Funky hip hop music)

that is better than expected economic data out of the U.S. and further solidifying this idea that we might not get any rate cuts in 2024. On the flip side, nvidia is holding on to its gains and pretty as enthusiastically as it's been through the session, though, at one point was up as much as 11%. The stock now up only 7 and a half percent, but still another record high. We're going to talk to the most bullish analysts on the street sees more gains ahead. One of the biggest pressure points on the dow boeing warning that it's going to be more burning, more cash than expected. Boeing shares are down. Td investors trying to figure out what to do with shares of td after an unexpectedly grew profit in its latest quarter. Analysts were expecting a slight decline in profit. But even with that underlying strength in the business, the anti-money laundering issues continuing to be a dark cloud. The stock down about 2%. All this and more coming up. But first, here's a look at some of the top stories we're tracking for you right here in the bnn bloomberg newsroom. Shares of live nation are the worst performing on the s&p 500 is the U.S. justice department and a group of states are suing the company for antitrust violations related to the control of concert tickets sales by live nation's ticketmaster. Now live nation says it's going to respond to this later on this evening. Lawsuits are seeking remedies, including a breakup of the company. >> Our complaint makes clear what happens when a monopolist dedicates its resources. Entrenching its monopoly power and insulating itself from competition rather than investing in better products and services. We allege that live nation has a legally monopolize markets across the live concert industry in the united states for far too long. It is time to break it up. >> Westjet airlines plans to launch a new cheaper fare category for travellers willing to flight without a carry on bag. Ceo alexis von hoensbroech says the new ultra-low fare category will be introduced in the next few weeks. Travellers will not have the option to put a bag in the overhead bins, but those still be permitted to store a knapsack or small personal item underneath the seat in front of them. Maple leaf foods says it will be closing its poultry plant in brantford, ontario, on consolidating production within its existing network earlier this year. The company said the 100 year old facility would need significant ongoing invetment to continue operating long-term. Maple leafs says the closure will happen in stages and affected employees will be given opportunities and other locations. Let's take a look at the market action. We're seeing major pressure across the north american indices. The tsx is no exception to that as we've got the price of gold falling for a 3rd session in a row. Oil prices now trading at the lowest level since february. So both of those sectors weighing on our index. Meanwhile, south of the border, you really have got to squint to look for any stocks that are trading up, even with that halo effect that we're getting from nvidia. Take a look at the dow down one and a half percent. It's really not just boing boing certainly is the most influential to the downside, but almost no stock is up on the dow jones industrial average. And on the nasdaq, 187 of the issues are down. (Upbeat electronic music) well, td bank kicked off earnings season and managed to do it with a beat when it came to profit expectations. As I mentioned, analysts were expecting profit to decline modestly. They surprised with a bit of doubt. That was a lot of strength in areas like canadian banking as well as capital markets. But the money that they're setting aside to deal with their anti-money laundering business bit anti anti-money laundering issues. I should say, certainly showed up in the U.S. business. Brought ms ronnie on the conference call called their failings. They're unacceptable. And he said that the hope that the bank would reach a resolution. As probes as soon as possible. For more on this, let's get perspective from benjamin sinclair. Equity analysts covering the banks at odlum brown. Thanks much for joining me. Thank you for having so you've got to buy rating on tv one that I guess has been difficult over the last year. I I know the aml issues are so huge. I just

want set them aside for second. And just look at the operational quarter at td, how do. >> I would characterize it as a as a low quality beat. You just said it. There was strength in canadian banking, there was strength capital markets. The latter is going to be a little bit more volatile anyways. All in all, we view this as part of a transition year for the banks in general. And we expect to see a similar pattern emerged on the other banks report next week. >> Again, though, and I'm still leaving aside, aml is she is a look at a royal that is nearing all-time highs and national bank that is at all-time jp morgan, south of the border at all-time why are all these banks moving higher, operating the same conditions that is? Td is it is it just because of the is it fair to say it's just because of the aml penalty, not 100% business mix does make a difference, but of course, am out is a big part of >> Part of the picture as well, just to put in perspective, if you go back just a few years. >> You have rbc, you have national and you have td and more of a premium category. While scotia bmo and cibc were more in the valley category. And we've clearly seen td get kicked from the first category into the second. We actually view that as being appropriate, an appropriate well, he's got a issues ahead of it. And you heard on the conference call this morning. Analysts are looking for certainty and also looking for a timeline. Unfortunately, it wouldn't even be td timeline. There. These things always tend to take longer. Banks and their shareholders want them to and we just have to be cognizant of so the pushback even if it's a worst-case scenario with respect into money laundering. >> This is a bank who can deal with that financially. >> Yeah, and look, we still have a buy rating on the stock first, just for context. Analysts estimates are out one calls for a fine of up to 2 billion dollars. Compare that to the amount the market cap has dropped in the past month, about 9 billion dollars. Just look at those 2 numbers. Looks like a excellent buying opportunity, but clearly there will be other headwinds for the banks, whether that's increased regulatory costs or even possibly a consent order or more abstract factors like culture or brand. >> So on the consent order, that basically means you can't go into the U.S. and expand, you can't go and buy another company. Well, it's soon is too soon to speculate. What exactly would look but so safe to say that is the case. Again, they're sitting on those capital high high capital levels. So what to do with it? I don't buy back more of your shares, is that not and not good enough. >> So certainly that's, that's a very reasonable option for them, especially if the shares continue to languish. >> We've been talking some of the issues with respect to td and you brought up the issues of expenses. That's one of the reasons national bank analysts actually downgrade the stock worried that the expenses are just going to be more than what he is currently forecasting. How much do you think that, that that is another downside risk for tv? It's absolutely another downside risk. I'd say it's a it's a bigger downside risk than >> The risk of a of a one-time 5 or even just a handful of and and yeah, I feel like I have to remind few years, you do have a buy on the stock. So why is that? >> Well, we have a buy rating on rbc and td and scotia and clearly we are big believers and owning large dominant banking franchise in canada. We've owned them for decades. We hope and anticipate to own them for decades. More. And in all likelihood, we're just going to ride them out chair for td to to overcoming challenges. I think that's important perspective is you're not shuffling this. The banks in and out of the portfolio every quarter. >> They you're trying to look at as well as a long-term business and whether this is a core holding for the long term. That's how we invest across all sectors. Alright benjamin, thanks much for joining us with those insights as benjamin sinclair joining us from on them brown. We're going to take a quick break when we come back, we're going to take a look at the charts of the markets. Are we hitting some breaking point? Certainly we're seeing some pressure in equities bill today, carter oxen worth will join us next. Champion Iron offers a rare solution to decarbonize the steel industry. Which represents up to 10% of global emissions. The company recently doubled production capacity at its mine in eastern Canada. It is now investing to produce one of the world's purest iron ore. Enabling green steelmaking without the use of coal. Controlling a large portfolio of high purity iron ore resources.

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