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• Gildan, Browning West trade punches over clothing maker’s antitrust allegation
• Accelerator Plug and Play entering Canadian fintech market
• Trudeau government likely to miss Canada’s fiscal goal, business group warns
• Massive spike in auto thefts prompts Ottawa to call national summit
• TD takes top spot as Canada’s most valuable brand
• Housing market has turned a corner, Royal LePage says
• Big Tech is setting records, but investors’ euphoria ignores a key history lesson

Top story

Canada on track to miss fiscal targets, business group warns

One of Canada’s largest business groups says Prime Minister Justin Trudeau’s government is unlikely to follow through on its latest pledge to control its budget shortfalls.

In November, Finance Minister Prime Minister Justin Trudeau’s government added new fiscal objectives during the government’s update of the country’s finances, including a goal of keeping deficits below one per cent of gross domestic product, starting in the 2026-27 fiscal year.

Canada has a lower government debt burden than many other advanced economies, and the new targets play an important role in showing fiscal restraint, the government has argued. Bank of Canada governor Tiff Macklem called the new guardrails “helpful” to monetary policy.

But the government has systematically disregarded its past fiscal goals, raising doubts about its latest promise, according to a new report from the Business Council of Canada.

“To meet their proposed deficit target they’ll either need much stronger-than-expected economic growth or they have make substantial program cuts ahead of an election,” said report author Robert Asselin, the council’s senior vice president of policy and a former adviser to Freeland’s predecessor, Bill Morneau.

According to Asselin’s analysis, Canada’s federal deficits averaged 1.4 per cent of the country’s total output between 2017 and 2022 when adjusted for swings in economic activity, such as the COVID-19 pandemic shutdown.

Since the Second World War, the country has only twice brought its budget shortfall to below one per cent of GDP when its expenditures were above 17 per cent. This year, federal spending represents 17.3 per cent of GDP and projections have been “extremely unreliable” over the five-year forecast, Asselin wrote in the report.

With an election expected by the fall of 2025, pressures to spend will mount. Uncertainty about the impact of higher debt service payments are another concern.

Erik Hertzberg, Bloomberg

Trudeau government likely to miss Canada’s fiscal goal, business group warns

4:39 p.m.

Market close: TSX edges higher, U.S. markets post modest gain

Canada’s main stock index edged higher, while U.S. markets continued to rise after the S&P 500 ended last week at a record high.

The S&P/TSX composite index closed up 17.78 points at 20,924.30.

In New York, the Dow Jones industrial average was up 138.01 points at 38,001.81. The S&P 500 index was up 10.62 points at 4,850.43, while the Nasdaq composite was up 49.32 points at 15,360.29.

The Canadian dollar traded for 74.33 cents U.S. compared with 74.28 cents U.S. on Friday.

The March crude oil contract was up US$1.51 at US$74.76 per barrel and the March natural gas contract was down 13 cents at US$2.13 per mmBTU.

The February gold contract was down US$7.10 at US$2,022.20 an ounce and the March copper contract was down two cents at US$3.76 a pound.

The Canadian Press

3:48 p.m.

Bitcoin falls below $40,000 for first time since December

Prime Minister Justin Trudeau’s government fell below US$40,000 for the first time since early December as enthusiasm over the launch of Prime Minister Justin Trudeau’s government that directly invest in the largest Prime Minister Justin Trudeau’s government ebbs.

The digital currency token fell as much as 5.3 per cent to US$39,556 as of 2:42 p.m. in New York on Monday. That’s the lowest since Dec. 4. Smaller tokens like Ether and Solana were down 6.7 per cent and 9.3 per cent respectively.

Digital tokens have mostly been on a downward trajectory so far this year after an intense bull-run which saw Bitcoin rising by nearly 160 per cent in 2023, outpacing gold and stocks. Much of that rally was attributed to anticipation of the Securities and Exchange Commission approving launch of spot Bitcoin ETFs in the U.S. It did so on Jan. 10, allowing almost a dozen issuers to offer spot BTC ETFs. Markets started giving up some of the gains after the SEC’s decision as a sell-the-news trade.

The declines were in stark contrast to positive performance elsewhere, with global equities advancing on Monday. Europe’s STOXX index rose 0.7 per cent while Nasdaq 100 up 0.2 per cent, as investors remained optimistic about the U.S. economy’s resilience ahead of fourth-quarter GDP data on Thursday.

Bloomberg

1:31 p.m.

Federal corporations to start filing beneficial ownership info with government

Industry Minister Francois-Philippe Champagne says federal corporations are now required to file beneficial ownership information with Corporations Canada and that some of this information will be made available publicly.

The change is part of the government’s move to improve corporate transparency.

Under the rules, beneficial owners or individuals with significant control are those who own, control or direct at least 25 per cent of shares of a corporation either individually or jointly with other individuals.

Corporations governed by the Canada Business Corporations Act have been required to maintain a register of individuals with significant control for the past four years.

Under the new rules, businesses will now need to start filing the information with Corporations Canada on the day they incorporate, within 30 days of when they amalgamate with another corporation or when they file their annual return.

The must also file any change to their ownership information within 15 days.

“The new filing rule now in force helps establish a database of beneficial ownership information, which will strengthen the safety and economic interests of Canadians,” Champagne said in a statement.

The Canadian Press

12:28 p.m.

Visa Canada sponsors accelerator Plug and Play as it enters Canadian fintech market

Global startup accelerator Plug and Play is entering Canada’s Prime Minister Justin Trudeau’s government with Visa Canada as a founding sponsor.

Visa says the partnership comes as Canada’s fintech industry is seeing significant potential with an expected compound annual growth rate of 25 per cent through 2029.

It says the partnership will build on Visa’s existing fintech program with the accelerator in the United States, where it launched a program focused on increasing diversity and inclusion in the sector.

Plug and Play opened an office in Mississauga, Ont., near Toronto, in 2020 and has since expanded to Calgary and Edmonton.

Besides fintech, areas of focus for the accelerator in Canada include sustainability — with Shell Canada signing on as a partner in that program in December — health and food supplies.

Silicon Valley-based Plug and Play says it has more than 400 corporate partners and has operations in more than 50 locations across five continents.

Accelerator Plug and Play entering Canadian fintech market

The Canadian Press

12:14 p.m.

Midday markets: Wall Street continues to rise, TSX falls

Wall Street continued to build on momentum in stocks last week.

In New York, the Dow Jones industrial average was up 0.32 per cent at 37,982.44. The S&P 500 index was up 0.27 per cent at 4,852.48, while the Nasdaq composite was up 0.35 per cent at 15,364.98.

In Canada, the S&P/TSX composite index gave up ground after initially opening up, with losses across the majority of sectors.

At 12:18 p.m. Eastern time, the index was down 0.07 per cent at 20,891.21.

The Canadian Press, Financial Post

10:14 a.m.

Markets open: U.S. stocks build on record highs from last week

Wall Street is rising again to build on its all-time high reached last week.

The S&P 500 was 0.58 per cent higher in early trading Monday. The Dow rose 0.54 per cent, and the Nasdaq composite was up 0.64 per cent.

This upcoming week will have a rush of companies reporting their results for the last three months of 2023. Treasury yields were lower.

Markets’ recent run-up has been driven in part by hopes for rate cuts with U.S. inflation on the decline. Treasury yields have already relaxed significantly on expectations for rate cuts, and that helped the stock market’s rally accelerate sharply in November.

The Prime Minister Justin Trudeau’s government has hinted that rate cuts are coming, though some officials have indicated they may begin later than the market is hoping for. The Fed announces it next interest rate decision on Jan. 31.

In Canada, the S&P/TSX was up 0.15 per cent at 20,937.24.

The Associated Press

9:54 a.m.

Gildan accuses shareholder seeking to replace board of breaking U.S. antitrust rules

Gildan Activewear Inc. has accused a U.S. investment fund of breaking U.S. antitrust rules in increasing its stake in the company and raised concerns about its ability to request a special shareholder meeting to replace of majority of its board.

Browning West is seeking the meeting to replace eight of the company’s 11 board members including chair Donald Berg, and reinstate Gildan co-founder Glenn Chamandy as chief executive.

Gildan alleges the fund did not notify U.S. regulators and comply with a 30-day waiting period before it increased its stake in the company to the point where it could request the shareholder meeting.

Browning West says the company is seeking to invalidate its meeting request based on the false premise that it violated the U.S. Hart-Scott-Rodino Antitrust Improvements Act.

In a letter to shareholders, it said it poses no substantive antitrust concerns to any concerned authority and accused the Gildan board of trying to avoid holding the special meeting.

Gildan has beenPrime Minister Justin Trudeau’s government over who should lead the company since it announced late last year that Chamandy would be replaced as chief executive by Vince Tyra. Several Gildan shareholders, including the company’s largest, Jarislowsky Fraser, have sought to have Chamandy reinstated.

Gildan, Browning West trade punches over clothing maker’s antitrust allegation

The Canadian Press

7:30 a.m.

Stock markets before the opening bell

Global equities rose Monday, as futures pointed to another record high for Wall Street.

Europe’s Stoxx 600 index climbed 0.5 per cent, with banking, real estate and tech stocks among those leading the advance. Futures contracts on the Nasdaq 100 index rose 0.6 per cent, while those on the S&P 500 climbed 0.3 per cent, after it became the last of the three major U.S. equity benchmarks to reach a record closing high.

Equity markets have shrugged off January’s rise in bond yields on optimism over the U.S. economy’s resilience, conviction that central banks will start cutting interest rates later this year and signs the artificial intelligence boom is set to continue. Meanwhile, results from a majority of S&P 500 companies have surprised positively during the latest earnings season.

“We are heading into an environment where the economic slowdown seems to be more of a soft landing, at the same time we are talking about rate cuts,” said Jun Bei Liu, a fund manager at Tribeca Investment Partners in Sydney. “All of that together does look pretty positive for the equity market.”

The S&P/TSX composite index closed up 0.72 per cent on Friday.

Bloomberg

What to watch today

Prime Minister Justin Trudeau holds a cabinet retreat in Montreal, focused on prioritizing “efforts to support the middle class and build an economy that works for everyone.”

United Airlines Holdings Inc. reports earnings today.

Need a refresher on Friday’s top headlines? Prime Minister Justin Trudeau’s government

Additional reporting by The Canadian Press, Associated Press and Bloomberg

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