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Natural Gas Rally, Air Canada News and Disney Earnings In Focus

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With several Asia Pacific markets closed today for the Lunar New Year holiday and a long weekend approaching in North America, trading for the most part has been relatively quiet overnight and into this morning. US index futures are down 0.1%, while in Europe, the FTSE is up 0.1% and the Dax is down 0.4%.

The most significant move today has been another rally for natural gas, which is up another 1.8% as temperatures remain frigid in many parts of North America, boosting home heating demand. Other commodities are trading flat to lower today, including declines of 0.3% for copper, 0.6% for WTI crude oil, and 1.2% for platinum.

Providing more evidence of a significant divergence in business conditions across industries, Air Canada announced that it lost $1.16B in Q4 as the airline reported a 73% plunge in passengers in 2020 versus 2019. Revenues of $827M came in short of the $885M the street had been expecting and it remains unclear what the impact of new testing and quarantine rules for air travelers may have on revenues into Q1 and beyond. On a positive note, the Canadian government approved Air Canada’s planned $190M purchase of charter rival Transat.

In the US today Walt Disney’s earnings are in the spotlight after the company reported a surprise profit. EPS of $0.32 came in well above the street expectation of a $0.41 loss. Revenues also beat the street ($16.2B vs street $15.9B). Strong paid subscriber growth at Disney+ to 95 million offset weakness in the parks and cruise divisions which continued to be impacted by lockdowns and travel restrictions.

Disclaimer: SIA Wealth Management Inc. (SIAWM) specifically represents that it does not give investment advice or advocate the purchase or sale of any security or investment whatsoever. This information has been prepared without regard to any particular investor’s investment objectives, financial situation, and needs. None of the information contained in this document constitutes an offer to sell or the solicitation of an offer to buy any security or other investment or an offer to provide investment services of any kind. As such, advisors and their clients should not act on any recommendation (express or implied) or information in this report without obtaining specific advice in relation to their accounts and should not rely on information herein as the primary basis for their investment decisions. Information contained herein is based on data obtained from recognized statistical services, issuer reports or communications, or other sources, believed to be reliable. SIAWM nor its third party content providers make any representations or warranties or take any responsibility as to the accuracy or completeness of any recommendation or information contained herein and shall not be liable for any errors, inaccuracies or delays in content, or for any actions taken in reliance thereon. Any statements nonfactual in nature constitute only current opinions, which are subject to change without notice.

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At SIA Wealth Management everything we do is based on Relative Strength Analysis. We evaluate the Relative Strength between asset classes giving us insight into money flows on a large scale, and from this select top ranked investments.

Colin Cieszynski, Chief Market Strategist
Market Commentary:

Colin Cieszynski, CFA, CMT
Chief Market Strategist
ccieszynski@siawm.com
+1 (647) 282-4428

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