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Daily Pulse

One of our most accessible tools, this daily comment keeps you abreast of developments on the North American and international financial markets.

Michel Doucet

Michel Doucet
Vice-President and
Portfolio Manager

May 7, 2021

Canada

Air Canada reported a loss of $1.3 billion in its first quarter compared with a loss of $1 billion in the same quarter last year as the pandemic continued to limit travel. The airline says the loss amounted to $3.90 per diluted share for the quarter that ended March 31 compared with a loss of $4.00 per diluted share a year ago when it had fewer shares outstanding. Revenue in the quarter totalled $729 million, down from $3.7 billion in the first three months of 2020. Air Canada says its capacity as measured in available seat miles was down 82.1 per cent compared with a year ago, while traffic measured in revenue passenger miles was down 89.5 per cent.

United States

President Joe Biden on Thursday said he wants to see a corporate tax rate “between 25 and 28” percent, setting down a new marker in the ongoing negotiations over how to fund a major infrastructure bill. “The way I can pay for this is making sure that the largest companies don’t pay zero, and reducing the [2017 corporate] tax cut to between 25[%] and 28[%],” Biden said at an event in Louisiana. “That’s a couple hundred billion dollars, and we can pay for these things.” The remarks were the first time Biden had explicitly acknowledged that his initial proposal of raising the corporate tax rate to 28%, up from the current rate of 21%, was shifting amid negotiations on the massive infrastructure bill.

Europe

Siemens raised its full-year profit and sales guidance on Friday for the second time this year, after the German conglomerate beat earnings forecasts for the second quarter. Siemens reported adjusted second-quarter EBITDA for its industrial businesses of 2.1 billion euros ($2.53 billion), a 31% increase on the same period last year, as the company recovered sharply from its pandemic-induced downturn. Net income for the second quarter hit 2.4 billion euros and earnings per share rose to 2.82 euros, while orders climbed 8% on a nominal basis to 15.9 billion euros on the back of sharp growth in healthcare unit Siemens Healthineers.

Asia

China’s exports surged more than expected in April as global demand for Chinese goods remained elevated amid countries’ varying stages of dealing with the coronavirus pandemic. U.S. dollar-denominated exports rose 32.3% in April from a year ago, China’s customs agency said Friday. That beat an estimate of 24.1% growth from analysts polled by Reuters. Imports rose 43.1% in U.S. dollar terms, also topping expectations of 42.5% growth, based on a Reuters poll.

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