Financial Turbulence Takes Toll on Markets

The recent spate of financial turbulence has left a lasting impact on markets, with bonds and equities suffering significant losses. However, the gains in precious metals have provided a rare silver lining for sector funds, according to a Report on Business six-month survey. The survey reveals a tumultuous landscape, with interest rates, inflation, and currencies all contributing to investor woes.

Key Takeaways:

• Banks raised prime rates by half a percentage point to 7.25%, prompting concerns that this may lead to corporations delaying investment decisions.
• Losses piled up on Canadian and U.S. stock and bond markets, with investors fretting about interest rates, inflation, and currencies.
• Cable industry watchers expect the winning bid for Rogers' U.S. cable assets to be around $1.6-billion, slightly above the minimum $1.5-billion set by Rogers.
• A fledgling company backed by Paul Reichmann 11 years ago now has over $6-billion (U.S.) worth of assets under its administration.
• Rowland Fleming has left National Trustco amidst speculation of a clash with the board of directors or a falling out with controlling shareholder Henry (Hal) Jackman.
• Pop maker Cott took a significant beating on the stock market after reduced profit predictions by company officials.
• Canada's general insurance companies suffered losses due to the severe winter, with first-quarter profits taking a hit.
• Canadian General Insurance's initial public offering (IPO) of shares was rejected by bank creditors.
• Canadian house sales are being impacted by recent mortgage rate hikes, with sales in May down 1.9% from the same month last year.
• U.S. industrial production was up in May, but signs of moderating economic growth may stall further interest rate increases.
• The phone book arm of BCE stands to double its offshore sales through a 10-year joint venture with the local Hong Kong telephone company, generating $1-billion (U.S.) in revenue.
• Ottawa and the provinces are rushing into a flawed interprovincial trade deal without adequate Canadian consultation, according to a study.
• George Soros made $1.1-billion (U.S.) last year, topping the GDP of at least 42 countries.
• Tony Miller is returning to Toronto to head up MacLaren:Lintas after a brief stint as chairman of the New York office.

Statistics:

• Prime rates raised to 7.25% (up by half a percentage point)
• Losses piled up on Canadian and U.S. stock and bond markets
• Expected winning bid for Rogers' U.S. cable assets: $1.6-billion
• Assets under administration by the company backed by Paul Reichmann: over $6-billion (U.S.)
• Reduced profit predictions by Cott officials
• First-quarter profits hit by severe winter for Canada's general insurance companies
• Canadian house sales down 1.9% from same month last year
• U.S. industrial production up in May
• Signs of moderating economic growth in the U.S.
• Revenue from BCE's phone book arm through joint venture with Hong Kong telephone company: $1-billion (U.S.)
• George Soros' annual earnings: $1.1-billion (U.S.)

Sources:

• Report on Business six-month survey (no specific date mentioned)
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