On Monday, the S&P 500 fell 0.5% while Toronto rose 0.8%.
Agrium was up 2.8% and Melcor was up 4.7%.
FedEx was down 3.4% but that comes after two months in which it gained about 14%.
Walmart was down 1.8%
The Canadian Western Bank rate reset preferred share was down 3.9% to $17.86. These share’s trade very thinly. At $17.86 the yield is 6.16%. To me, that seems attractive and I expect these shares to trade higher in the coming months. But there is always the risk that they will trade even lower if Canadian Western Bank reports credit losses or their is fear that they will. This bank announced last month that it was going to redeem $300 million of debentures on November 30 (today). It looks like they may have had the cash to do this but they may also decide to issue new preferred shares at a higher yield and with perhaps a guaranteed minimum reset level and if they did, that could also cause these existing shares to fall. Or the Bank of Canada could reduce interest rates. There are ALWAYS scenarios under which any investment can fall in price. Which is why many people never invest in stocks at all.
The Canadian Banks report earnings this week. CWB is scheduled to report by Thursday morning. I don’t think they will report much of an increase in actual credit losses. But they might report an increase in reserves for such losses.
I did purchase some Boston Pizza shares on margin today, having indicated yesterday that I planned to do so. I did not get as many shares as I wanted as I did not want to chase the price higher so I will likely add to this in the next few days.
I added an article about this strategy as well as a new article on management capital allocation skills. You likely received my newsletter email about these two articles.
The Alberta Securities Commission extended Canadian Oil Sands bid review period from 60 days to 90 days. Suncor had wanted it to stay at 60 days while COS wanted it extended to 120 days. It’s typical of regulators to seek a middle ground. They will have stated many reasons why 90 days is correct. But at the end of the day the human tendency to compromise is likely what drove them to the 90 days. It will be interesting to see Suncor’s next move. I’d like to see them refuse to extend their bid beyond Friday as planned. That would likely cause the COS shares to fall and would be entertaining if nothing else. Those who are convinced COS is worth more than the Suncor bid could then show the courage of their convictions by buying more.