Today’s headlines

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Top headlines: Federal deficit soars to $23.6 billion as debt charges mount Back to video

• Lynx Air is shutting down — what to do if you’re stranded or need a refund
• Ontario housing supply overstated by almost 1 million, land development study reveals
• A spousal buyout can let you keep the family home while untying the knot 
• FP Answers: What does having a ‘moat’ mean in investing?
• TD Bank CEO soon to be focus of succession talk, Jefferies analysts say
• Pembina Pipeline puts off final Cedar LNG investment decision until mid-year

Top story

Federal government posts $23.6 billion deficit for April-to-December period

The federal government posted a budgetary deficit of $23.6 billion for the first nine months of its 2023-24 fiscal year.

The result compared with a deficit of $5.5 billion for the same stretch of its 2022-23 fiscal year.

Government revenue for the April-to-December period totalled $318.1 billion, up from $310.0 billion a year earlier, boosted by higher personal income tax revenue, other non-tax revenue and other taxes and duties, partially offset by lower corporate income tax.

The government says program expenses, excluding net actuarial losses, totalled $301.0 billion for nine-month period, up from $282.4 billion a year earlier, with increases across all major categories of spending.

Public debt charges amounted to $35.1 billion, up from $25.8 billion, due to higher interest rates.

Net actuarial losses totalled $5.7 billion, down from $7.4 billion a year earlier.

— The Canadian Press

4:39 p.m.

Market close: TSX up almost 100 points, U.S. markets mixed

Canada’s main stock index gained almost 100 points Friday, while U.S. markets mostly held on to their gains after soaring the day before.

The S&P/TSX composite index closed up 95.07 points at 21,413.15.

In New York, the Dow Jones industrial average was up 62.42 points at 39,131.53. The S&P 500 index was up 1.77 points at 5,088.80, while the Nasdaq composite was down 44.80 points at 15,996.82.

The Canadian dollar traded for 74.11 cents US, unchanged from Thursday.

The April crude contract was down US$2.12 at US$76.49 per barrel and the April natural gas contract was down 13 cents at US$1.70 per mmBTU.

The April gold contract was up US$18.70 at US$2,049.40 an ounce and the May copper contract was down one cent at US$3.90 a pound.

— The Canadian Press

4:31 p.m.

McGill, Concordia universities sue Quebec over tuition hike

Montreal’s McGill University, along with Concordia University, is taking legal action against the Quebec government for raising tuition for Canadian students from other provinces.

Last year, Quebec announced it would almost double tuition fees to $17,000 for out-of-province students coming to study at English-language universities in Canada’s French speaking province. The decision, made to protect the French language, sparked outrage in Montreal’s anglophone community and in the business sector.

In response, Quebec agreed to a smaller increase that would set tuition at $12,000. Students attending Bishop’s University, a small school outside Montreal, would be exempt from the hike. In exchange, the government added a new requirement that 80 per cent of their non-Quebec students must reach a level of French proficiency by the end of their undergraduate degree it says is roughly equivalent to being able to book a hotel room over the phone.

McGill University is seeking to reverse the hike, arguing it’s discriminatory under both the Canadian and Quebec charters of rights and freedoms. Undergraduate applications from Canadian students outside Quebec have fallen by more than 20 per cent, it said in a news release.

“We are hearing from our recruiters that these measures are making students think twice about coming to Quebec,” McGill President Deep Saini said in the statement.

Graham Carr, Concordia’s president, said in a separate statement that “the changes could have a significant and harmful impact on Concordia’s student enrollment, financial well-being and international reputation.”

— The Canadian Press

3:25 p.m.

Alberta Energy Regulator accepts Grassy Mountain coal mine proposal

Alberta’s energy regulator says it will accept an application and open hearings into a controversial open-pit coal mine on the southern slopes of the province’s Rocky Mountains.

In a letter dated Thursday, the Alberta Energy Regulator says it has decided the Grassy Mountain proposal should be considered an advanced project and be exempt from a ministerial order banning coal development along the province’s eastern slopes.

The letter says the regulator reached the decision after receiving a note from Energy Minister Brian Jean suggesting the project falls into the exempt category.

It says the application will go before a public hearing, although it doesn’t set out the rules for that hearing or who will be eligible to appear before it.

The Grassy Mountain steelmaking coal project near Crowsnest Pass has been before regulators for years and was denied permits by both the Alberta and federal governments in 2021 after a lengthy environmental assessment.

Proponent Benga Mining, now named Northback, lost an appeal of that decision in Alberta’s top court and the Supreme Court of Canada declined to reconsider it.

Northback has applied for exploration and water diversion licences.

— The Canadian Press

1:10 p.m.

Pembina Pipeline defers Cedar LNG decision until mid-2024

Pembina Pipeline Corp. says it will defer making a final investment decision on its proposed Cedar LNG project until mid-2024.

The Calgary-based pipeline company and its project partner, the Haisla First Nation, have been working to develop plans for a floating liquefied natural gas facility in Kitimat, B.C.

The project partners had previously said a decision to go ahead with the project could be made before the end of the first quarter, with onshore construction work starting as soon as the second quarter of this year.

But Pembina now says there a number of issues that must be resolved before a final decision can be made, including ongoing negotiations for commercial offtake, agreements, the obtaining of certain third-party consents, and project financing.

Cedar LNG has already obtained all major regulatory approvals and is advancing an agreement that would connect the floating facility to Coastal GasLink, the TC Energy-owned pipeline that will also carry natural gas to the Shell-led LNG Canada facility currently under construction.

The capital cost of Cedar LNG was originally estimated at US$2.4 billion, but Pembina Pipeline chief financial officer Cameron Goldade said Friday the company now believes it will cost more than that.

Pembina Pipeline puts off final Cedar LNG investment decision until mid-year

— The Canadian Press

12:05 p.m.

Midday markets: TSX rises, S&P 500 retreats from milestone

Strength in financial and technology stocks helped lift Canada’s main stock index in late-morning trading, while U.S. stock rose as well.

The S&P/TSX composite index was up 60.67 points, 0.35 per cent, at 21,393.86.

In New York, the Dow Jones industrial average was up 153.60 points, 0.39 per cent, at 39,224.51. The S&P 500 index was up 7.78 points, 0.15 per cent, at 5,094.47, pulling back after passing the 5,100 milestone earlier in the trading session. The Nasdaq composite was up 9.01 points, 0.06 per cent, at 16,051.00.

The Canadian dollar was down 0.11 per cent at 74.05 cents US compared with 74.11 cents US on Thursday.

The April crude contract was down 2.4 per cent at US$76.76 per barrel.

The April gold contract was down 0.91 per cent at US$2,049.10 an ounce.

— The Canadian Press

10:28 a.m.

S&P 500 passes 5,100 milestone for first time

The rally in stocks moderated on Friday, but the relatively smaller gains were enough to push the market toward another milestone.

A feat of multiple records in the world’s biggest equity market drove the S&P 500 past the 5,100 level for the first time ever. Buoyed by the revolutionary artificial-intelligence technology and signs of economic resilience, stocks were also on track for another all-time high. After its big post-earnings advance, Nvidia Corp. is now set to become the first semiconductor firm with a US$2 trillion valuation.

The S&P 500 traded around 5,110 — with gains once again led by technology companies. Nvidia climbed three per cent extending this year’s surge to about 65 per cent — the best performance by far in the American equity gauge.

— Bloomberg

10:20 a.m.

Scotiabank partnership to create Indigenous-owned investment dealer

Two Indigenous development corporations and one First Nation have partnered with The Bank of Nova Scotia to create a new Indigenous-owned investment dealer.

Cedar Leaf Capital Inc., which still needs regulatory approval, will be majority-owned by Nch’kay Development Limited Partnership, Des Nedhe Financial LP and Chippewas of Rama First Nation.

Together they will own a 70 per cent stake, while Scotiabank will initially hold 30 per cent and control the investment dealer.

However, over time, Scotiabank intends to reduce its controlling stake so that Cedar Leaf will become a fully Indigenous owned and led investment dealer.

Cedar Leaf will offer Canadian institutional clients financial advisory services, with a focus on fixed income securities offerings.

The groups say it will foster greater Indigenous participation in the capital markets, create commercial opportunities for Indigenous communities, and partner with established market participants to help them in meeting their reconciliation commitments.

— The Canadian Press

10:01 a.m.

Morning markets: Wall Street on track for another winning week

Stocks are opening higher on Wall Street, keeping the market on track for its sixth winning week in the last seven. Technology stocks led the gains again, including another big drive upward from Nvidia Corp. The chipmaker clocked the biggest one-day gain in market value on record a day earlier after reporting blockbuster demand for its semiconductors, which are used to power AI applications.

The S&P 500 was up 0.42 per cent early Friday.

The Nasdaq composite was up 0.5 per cent and the Dow added 0.3 per cent. Intuitive Machines, the company that made the first United States lunar landing in more than 50 years, rose sharply. Treasury yields slipped.

In Toronto, the S&P/TSX composite index was down 0.12 per cent.

— The Associated Press

9:36 a.m.

TransAlta reports smaller loss compared with a year earlier

TransAlta Corp. reported a loss attributable to common shareholders of $84 million compared with a loss of $163 million a year earlier.

The power utility says the loss amounted to 27 cents per diluted share for the quarter ended Dec. 31 compared with a loss of 61 cents per diluted share a year earlier.

Free cash flow per share for the quarter amounted to 39 cents, down from $1.17 in the fourth quarter of 2022.

Revenue totalled $624 million, down from $854 million in the last three months of 2022.

Production for the quarter was 5,783 gigawatt hours compared with 6,005 gigawatt hours a year earlier.

In its outlook for 2024, TransAlta says it expects adjusted earnings before interest, taxes, depreciation and amortization of $1.15 billion to $1.30 billion for the year and free cash flow of $1.47 to $1.96 per share.

— The Canadian Press

7:30 a.m.

Loblaw shares hit all-time high twice in one week

Loblaw Cos. Ltd. set an all-time high for the second time this week as Canada’s biggest grocer rallied on a fourth-quarter earnings beat and expansion plans.

Shares ended the session up 3.5 per cent to close at $142.92 Thursday, the highest price for the stock since Loblaw began trading on the public markets in January 1983. The grocer earned an adjusted $2 per share in its fourth quarter, surpassing analyst estimates by 10 cents.

Earnings were bolstered by sales growth in pharmacy and health-care services as well as e-commerce. Loblaw topped its previous record set on Tuesday when the grocer announced it would be putting $2 billion toward adding 40 new stores to its network and renovating more than 700 others.

Loblaw will continue to outperform its peers like Empire Company Ltd. and Metro Inc. given its broader exposure to discount brands and pharmacy retail locations, according to Michael Van Aelst, an analyst at Toronto-Dominion Bank. Loblaw has a “superior 2024 earnings outlook” compared to Metro and Empire, he said.

Loblaw shares have advanced 11 per cent year-to-date, nearly doubling Metro’s growth of 6.3 per cent and Empire’s three per cent decline.

— Stephanie Hughes, Bloomberg

Stock markets before the opening bell

Markets took a breather on Friday as investors assessed the outlook for equities after benchmarks from the United States to Europe and Japan hit all-time highs in the wake of Nvidia Corp.’s blockbuster earnings.

U.S. futures were little changed after gains overnight pushed the S&P 500 and Nasdaq 100, along with MSCI’s all-county index, to new records. Nvidia is on track to scale $2 trillion in market value for the first time ever after shares climbed as much as 2.7 per cent in premarket trading, adding to Thursday’s meteoric rise.

Nvidia’s US$277-billion one-day boost to its market capitalization on Thursday was the biggest single-session increase in value ever — eclipsing a recent US$197-billion gain by Meta Platforms Inc. The question is whether the tech rally can be sustained and broadened to other sectors, even as bets on U.S. Federal Reserve rate cuts wane amid data showing the world’s largest economy is still going strong.

In Toronto, the S&P/TSX composite index closed up 0.69 per cent on Thursday.

— Bloomberg

What to watch today

The Department of Finance Canada publishes financial results for December 2023.

The Greater Vancouver Board of Trade hosts Premier David Eby for an official address following the tabling of the 2024-25 provincial budget. The presentation will include an overview of the budget and an update on the state of B.C.’s economy.

Companies reporting earnings today include Onex Corp., TransAlta Corp., HudBay Minerals Corp. and CI Financial Corp.

Need a refresher on yesterday’s top headlines? Get caught up here.

Additional reporting by The Canadian Press, Associated Press and Bloomberg

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