Prof. Fournier Press Review: August 2 – August 6

By: Pierre Fournier

Agenda: Alimentation Couche-Tard, George Weston, Air Canada & Bombardier, European Central Bank & virtual currency, HSBC Bank, BP, GM, Bombardier, Market Review.

Photo: Olivier Zuida/Le Devoir

Acquisition for Alimentation Couche-Tard. According to Radio-Canada, Alimentation Couche-Tard plans on acquiring more than 225 convenience and gasoline stores in Atlantic Canada. The company announced that it has entered into a definitive agreement to acquire Wilsons Gas Stops. The transaction amount has not been disclosed, though Couche-Tard specified that the transaction will be completed during the second half of 2022. This transaction follows several acquisitions for Couche-Tard in previous years, as a way to respond to its growth strategy objective.

Excellent second-quarter results for George Weston. According to BNNBloomberg, Toronto-based food distribution company George Weston, which owns Loblaw, made a profit in its most recent quarter after reporting a loss for the same quarter a year earlier. It is important to note that Loblaw delivered a strong performance during this quarter. Indeed, its revenues have risen sharply despite unprecedented demand last year when consumers stocked up at each visit to the supermarket. Read more from CTV News.

Air Canada-Bombardier and the vaccination campaign. According to TVA Nouvelles, the Quebec government is adding new prizes to be won as part of its vaccination campaign. Some of these prizes include a seven-day getaway to Cancun in a private jet. Bombardier and Air Canada, partners of the corporate vaccination campaign, are offering these prizes free of charge. The winners of these prizes will be announced on September 3, along with the draw for the 1-million-dollar grand prize, among duly registered adults who have received two doses of the vaccine by August 31.

European Central Bank virtual currency pilot project. According to ECB Europa, it is now Europe's turn to launch its own virtual currency, following Chinese and Russian banks which have done the same earlier this year. The European Central Bank has announced the start of a two-year pilot project introducing a digital Euro. Precisely, this new virtual currency will be a response to the proliferation of cryptocurrencies during the COVID-19 crisis. Both the French and German governments have indicated the importance of this pilot project.

Photo: Facundo Arrizabalaga/EPA

Excellent results for HSBC bank. According to Reuters, HSBC Bank announced excellent profits in the first half of 2021, as the company has decided to restructure and focus on investing in Asia. HSBC recently announced a major reorganization to focus on Asia, where it generates 90% of HSBC’s profits, with the Chinese and Hong Kong markets being its flagships.

Excellent quarter for oil and gas giant BP. According to CNBC, British oil giant BP reported a second-quarter profit of US$ 3.1 billion. The oil sector has been affected by the recovery in the price of oil since last year. BP had suffered an enormous loss of US $ 16.8 billion last year, at the peak of the health crisis which had dampened demand for the price of oil. Crude prices have picked up sharply over the past year, now moving around US $ 70, in contrast to spring 2020 where prices hovered between US $ 30 and US $ 40. They are benefiting from the global recovery thanks to the readjustment of major economies.

Despite a profit, GM missed Wall Street's expectations. General Motors posted a profit in the second quarter, the automaker sold more expensive vehicles and raised its sales forecast for the full year despite a semiconductor shortage hampering production. According to CNBC, GM experienced a profit of US $ 2.8 billion from April to June, compared to a loss of US $ 800 million in the same period the year before. GM, like many in the automotive sector, has suffered since the start of the year from a lack of semiconductors—elements that are indispensable in cars loaded with electronic parts.

Very good results for Bombardier for the second quarter. According to Radio-Canada, with a satisfactory performance during the first two quarters of 2021, Montreal aircraft manufacturer Bombardier is revising its annual forecasts. After releasing its second-quarter results, the company said its revenue is expected to be over US $ 5.8 billion for the current fiscal year, with 120 aircraft deliveries expected, while its earlier forecast put revenue at US $ 5.6 billion.

MARKET REVIEW. According to CNBC, the Dow Jones and S&P 500 indices closed on record highs on the New York Stock Exchange on Friday, edging up to the creation of hundreds of thousands of jobs in the month of July. As for the Toronto Stock Exchange, it closed at a record high on Friday, supported by gains in the finance and energy sectors, as data extracted from job markets for July showed a decline in the unemployment rate.