Market news for Friday, May 10


(Illustration: Camille Charbonneau)

BASIC NEWS

• US lawmakers introduced a bill to ease restrictions on the export of artificial intelligence models. A bipartisan group of lawmakers introduced a bill last Wednesday that would make it easier for the Biden administration to impose export controls on artificial intelligence models in an effort to protect valuable American technology from foreign bad actors.

• US banks face climate risk data problems, Fed analysis shows. US banks face significant data and modeling problems in predicting the impact of climate change on their loan books, the Federal Reserve said on Thursday after its first analysis of the problem.

• Pipeline operator Enbridge beats profit estimates on strong demand. Pipeline operator Enbridge beat market estimates for first-quarter profit as demand remained strong amid rising North American oil production.

• Sun Life reports exceptionally weak earnings due to a weakening of operations in the United States. Sun Life Financial, Canada’s second-largest life insurer, on Thursday missed estimates for its core earnings for the first time in 12 quarters, punished by weak activity in the United States, a region where it has been expanding.

• The US Senate passed the Aviation Safety and Consumer Protection Act. The US Senate on Thursday overwhelmingly approved a sweeping aviation bill aimed at strengthening the air traffic controller workforce, increasing funding to prevent runway closure incidents and speeding up refunds for canceled flights.

TRENDS BEFORE THE OPENING

Futures on Canada’s main stock index rose on rising metal prices, and Brent crude rose above $84 a barrel on stronger demand. Canada’s April jobs report is expected later today. Wall Street futures rose as weaker jobs data bolstered investor optimism that the Fed will cut rates this year. In addition, several Fed officials are expected to speak later today, which could provide further guidance on the policy to follow. European shares also returned to record highs on euphoria over monetary easing and a strong earnings season, with the STOXX 600 and FTSE 100 hitting new highs. In Asia, the Nikkei was boosted by Wall Street gains overnight, but Chinese shares closed flat after the list of trade restrictions imposed by the United States expanded. The US dollar erased earlier losses, while the yen retreated as traders continued to test the resolve of Japanese authorities. to

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TOP SITES TO WATCH

• Enbridge: The pipeline operator beat market estimates for first-quarter profit on Friday as demand remained strong amid rising North American crude output. The company’s Mainline, North America’s largest pipeline system, has carried large volumes in recent quarters thanks to a surge in Canadian oil sands production and a delay in starting up a rival pipeline — Trans Mountain, owned by the Canadian government — in the second quarter. Adjusted profit in the main liquids piping segment increased to C$2.46 billion from C$2.34 billion in the year-ago quarter. On an adjusted basis, Enbridge reported earnings of 92 Canadian cents per share for the three months ended March 31, compared with the average analyst estimate of 81 Canadian cents per share.

• Sun Life Financial: Canada’s second-largest life insurer missed core profit estimates for the first time in 12 quarters on Thursday, hurt by weakness in the United States, a region where it is expanding. However, results in the United States were impacted by lower dental results due to the Medicaid review and market-related impacts primarily from real estate investments, the company said. For Sun Life, core net income rose 26% in Asia, while it fell 20% in the United States. The property and asset management department saw a decrease of 1%. This led to an overall underlying net profit decline of 2.2% to C$875 million. On a per-share basis, the company earned CA$1.50. Analysts had expected CA$1.65 per share. Sun Life Group health and protection profits fell 8% to C$280 million. The company reported a 4% decline in underlying net profit from its personal protection business to C$278 million due to the sale of Sun Life UK.

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