TOP NEWS • Chevron kicks off oil industry's fourth quarter results with a miss Chevron reported a fourth quarter profit that missed Wall Street estimates despite sharply higher oil and gas prices.
• U.S. refiner Phillips 66 posts quarterly profit on demand rebound Phillips 66 posted a fourth-quarter profit, compared with a year-ago loss, thanks to a rebound in demand for fuel and other refined products following COVID-19 vaccinations and easing restrictions.
• Caterpillar revenue beats estimates on rebound in construction demand Caterpillar beat quarterly revenue estimates on sustained demand for its heavy machinery and construction equipment as global economic activity recovers from pandemic lows.
• Britain's Cineworld hit by appeal in Cineplex legal battle Cineworld Group said Cineplex filed an appeal against its plea challenging an order the British cinema operator pay C$1.23 billion in damages to Cineplex for abandoning a planned takeover.
• Canada says it saw no need to block China firm's bid for lithium miner Canada did not stop Zijin Mining Group's bid for Neo Lithium because it saw no risk to national security, Innovation Minister Francois-Philippe Champagne said on Thursday.
BEFORE THE BELL Futures for Canada's main stock index were down on the prospect of faster interest rate hikes by major central banks. Wall Street futures edged lower, mirroring global equities, as rising tensions between Western powers and Russia hurt investor sentiment. Japan's Nikkei rebounded, buoyed by strong earnings from Apple. The U.S. dollar consolidated gains, while gold prices were in the negative territory. Oil prices advanced amid supply concerns.
STOCKS TO WATCH • Cineplex Inc: Cineworld Group said Cineplex filed an appeal against its plea challenging an order the British cinema operator pay C$1.23 billion in damages to Cineplex for abandoning a planned takeover. The London-listed company said it disagreed with the submissions made by Cineplex in its cross-appeal and will respond to it, adding Cineworld does not expect to pay any damages while the appeals are ongoing. In December, a Canadian court ordered Cineworld to pay the damages after the British firm walked away from a $1.65 billion deal in mid-2020, citing breaches in the merger agreement by Cineplex. Cineplex rejected the claims and accused Cineworld of avoiding its obligations under the agreement in light of the pandemic's impact on the industry.
• Neo Lithium Corp: Canada did not stop a Chinese firm's bid for the lithium miner because it saw no risk to national security, Innovation Minister Francois-Philippe Champagne said on Thursday. The opposition Conservatives said the Liberal government should have blocked Zijin Mining Group from buying Neo Lithium for C$918.7 million last year. The Conservatives say the decision to permit the purchase makes no sense at a time when Washington is working with Canada to boost regional supply chains of critical minerals to counter China's dominance. "There was sufficient information to make a determination ... that no national security harm could arise as a result of this transaction," Champagne told the House of Commons industry committee.
• Newcrest Mining Ltd: The gold producer said it expects output in the March quarter to improve from the previous one, but flagged weather issues and Omicron-led headwinds at its Lihir mine. Still, the miner posted a 10% sequential rise in second-quarter gold output, driven by higher throughput rates and increased mill capacity at its Cadia project. Newcrest, which expects to complete the acquisition of Pretium Resources in the current quarter, also said it was on track to achieve its full-year gold output guidance of 1,800 thousand ounces (koz) to 2,000 koz.
FOCUS Global gas rally to kickstart long-stalled U.S. LNG projects High global natural gas prices are breaking a two-year logjam of new U.S. liquefied natural gas (LNG) projects with at least three of the multibillion-dollar proposals likely achieving enough supply contracts to start construction this year, said developers and industry experts.
ANALYSTS' RECOMMENDATION • Cenovus Energy Inc: RBC raises target price to C$24 from C$20 to reflect the company’s operating momentum, capital discipline, rapid balance sheet deleveraging and rising shareholder returns.
• Saputo Inc: RBC cuts target price to C$37 from C$40 due to challenging demand, supply chain, and labor backdrops.
• Stelco Holdings Inc: RBC cuts target price to C$53 from C$64 based on the near-term volatility in the steel market.
ECONOMIC EVENTS (All timings in U.S. Eastern Time) 1100 (approx.) Budget balance for Nov: Prior -C$3.68 bln 1100 (approx.) Budget, year-to-date for Nov: Prior -C$72.25 bln
COMPANIES REPORTING RESULTS January 28 & 31: No major companies are scheduled to report.
CORPORATE EVENTS No major events are scheduled for the day.
EX-DIVIDENDS Canadian Tire Corporation Ltd: Amount C$1.30 Exchange Income Corp: Amount C$0.19 First National Financial Corp: Amount C$0.19 Freehold Royalties Ltd: Amount C$0.06 LifeWorks Inc: Amount C$0.06 Mullen Group Ltd: Amount C$0.05 Northland Power Inc: Amount C$0.10 Peyto Exploration & Development Corp: Amount C$0.05 Savaria Corp: Amount C$0.04 Sienna Senior Living Inc: Amount C$0.07 Superior Plus Corp: Amount C$0.06 Whitecap Resources Inc: Amount C$0.02
(All analysts' estimates are according to I/B/E/S Refinitiv data)
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