Everything You Need to Know on Wednesday: Enbridge Raises $3.5 Billion Through Bond Sale After Ratings Cut

Good morning mooers! Here are things you need to know about today's market:

● S&P/TSX 60 Index Standard Futures are trading at 1,329.20 ,down 0.22%.

● Gold pares back from fresh record before Powell is set to speak

● Oil hits US$85 for first time since October as market tightens

● Toronto home prices rise, but sales slow in March

● Stocks to watch: Enbridge, BlackBerry

Today, the Canadian dollar is trading at 73.73 cents US, a slight increase from Tuesday.

The S&P/TSX 60 Index Standard Futures (SXF) are currently trading at 1,329.20, which is down 0.22% from the previous close.

Gold fell back from a fresh record as two U.S. Federal Reserve officials said they still expect the U.S. central bank to cut rates three times this year, with Chair Jerome Powell due to speak later Wednesday.

Bullion fell after setting a new peak above US$2,288 an ounce, while silver topped $26 an ounce — a two-year high. San Francisco Fed President Mary Daly and Cleveland counterpart Loretta Mester — both of whom vote on policy decisions this year — said three reductions were likely, though there’s no urgency. Lower rates benefit the non-yielding metals.

Gold has climbed more than 10 per cent this year, setting a series of records along the way, on expectations that lower U.S. interest rates are on the horizon.

U.S. crude futures hit US$85 a barrel in New York for the first time since October, as OPEC+ supply cuts underpin a steadily strengthening market.

Production curbs by the Organization of Petroleum Exporting Countries and its allies — coupled with a robust outlook for consumption this year — have helped push prices higher. Conflict in the Middle East has also caused swaths of global shipping to divert around Africa to keep crews and cargo safe.

Nearby oil futures are trading at large premiums to those later for a later date, indicating strong demand for barrels for immediate delivery.

Toronto home prices rose in March, but sales declined compared to a year ago, mixed results that the region's real estate board attributed in part to an extra statutory holiday in month.

According to monthly figures from the Toronto Regional Real Estate Board (TRREB), benchmark home prices rose by 2.5 per cent month over month and 0.3 per cent year over year to $1,121,615. Meanwhile, 6,560 homes changed hands in March 2024, down 4.5 per cent year over year. New listings surged by 15 per cent over the same period.

In a press release, TRREB said the sales slowdown was in part due to Good Friday falling in March this year, rather than April.

TRREB president Jennifer Pearce said market conditions were improving despite the sales slowdown and lower borrowing costs expected later in the year would accelerate that trend.

The longest portion of the four-part bond offering, a 30-year security, will yield 145 basis points over Treasuries, according to a person with knowledge of the matter, after earlier discussions for around 170 basis points. A floating rate note maturing in three years, which was announced at the start of the sale, was dropped before pricing.

The bond sale comes after Moody's downgraded Enbridge and its subsidiaries' senior unsecured debt to Baa2 from Baa1 on March 29, citing ongoing weakness in its financial profile.

“As Enbridge moves forward with several utility acquisitions and executes on a sizable capital program, we expect that the company will have low levels of financial flexibility and higher leverage,” Moody’s senior credit officer Gavin MacFarlane wrote in a statement.

Analysts expect loss per share of $0.03 on revenues of $153.2 million for the quarter, which would mark a jump of 1.5%.

The Waterloo, Canada-based company is expected to post fourth-quarter revenue largely in-line with market estimates, with IoT revenue likely rebounding. However, cybersecurity revenue is anticipated to fall.

Analysts expect the company's FY25 revenue outlook to fall short of expectations due to ongoing headwinds in its cybersecurity business and reduced EV production weighing on its IoT business.

"In light of cost reductions, we believe BlackBerry may guide to breakeven FY25 adj. EPS, above consensus; however, FY25 revenue guidance may fall short of expectations," said analysts at RBC Capital Markets.

Source: BNN Bloomberg, Financial Post, MT Newswire