Make Kitco Your Homepage

TSX futures edge higher; inverted yield curve triggers caution

Kitco News

Aug 12 (Reuters) - Futures for Canada's main stock index inched higher on Friday as the country's two main telecoms firms made headway with their merger deal, but sentiment was expected to be downbeat on worries over "soft landing" challenges for the economy.

Rogers Communications Inc (RCIb.TO) and Shaw Communications Inc (SJRb.TO) finalised an agreement to sell Freedom Mobile to Videotron, a unit of Quebecor Inc (QBRb.TO), in a C$2.85 billion ($2.23 billion) deal. read more

The sale could help Rogers and Shaw clear a key antitrust hurdle and pave the way for their C$20 billion merger. read more

Still, the focus will be on the yield on the Canadian 10-year government bond, which has fallen some 50 basis points below the 2-year yield and is signaling the Bank of Canada may raise interest rates to a level that triggers a recession. read more

It is the biggest inversion of Canada's yield curve in Reuters data going back to 1994, deeper than the U.S. Treasury yield curve inversion.

Following U.S. data earlier in the week that showed an easing of inflation pressures, money market investors cut their bets that the BoC would hike rates by another three-quarters of a percentage point next month. BOCWATCH

September futures on the S&P/TSX index were up 0.1% at 7:31 a.m. ET. The Toronto Stock Exchange's S&P/TSX composite index (.GSPTSE) ended up 0.5% on Thursday, adding to this week's rally and posting its highest closing level since June 10.

Gold financing company Sandstorm Gold (SSL.TO) beat estimates for quarterly earnings, with revenue rising 36% from a year ago.

ECN Capital Corp (ECN.TO) met quarterly earnings expectations of 9 cents per share and topped estimates on revenue.

Hydro One (H.TO), Ontario's biggest electricity distribution company, said a barge moving a crane hit three high-voltage transmission lines causing power outage for a few hours in downtown Toronto on Thursday. read more

($1 = 1.2785 Canadian dollars)

Reporting by Johann M Cherian in Bengaluru; Editing by Anil D'Silva
Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.