BNN Morning Newsletter

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BNN Morning Newsletter: April 16, 2012

Investors focus on U.S. financials
The chase by Mary Cej:

It was a tough week for North American stocks last week, but I'm back now. European stocks are mostly higher and U.S. index futures are pointing to early gains Monday as investors look for confirmation that U.S. consumers continue to spend and corporate balance sheets -- especially the banks' -- are stronger than they were a year ago. U.S. retail sales kick off the week's economic data points while Citigroup may set the tone today for a handful of heavyweight financials' earnings from the likes of Goldman Sachs, Bank of America and Morgan Stanley through the week.

Citigroup said a few moments ago that first-quarter net profit dipped 2 percent to 95 cents a share, missing the $1 US average estimate of analysts surveyed by Thomson Reuters. However, if you strip out a $1.3 billion credit valuation adjustment, or CVA, the company earned $1.11 per share. Frances says she will explain all this to me later. The headline number was enough to whittle a few points of stock index futures, however.

In Canada, the focus for the week will be on tomorrow's rate announcement from the Bank of Canada. No change to the rate is expected but BoC Governor Mark Carney may try to reinforce his warning to Canadian households that debt levels are too high and that rates must rise sometime, perhaps sooner than many Canadians expect. Carney must also acknowledge that the European debt crisis continues to threaten and austerity measures abroad will weigh on growth for quarters and years to come. He is also likely to point out that China's growth is slowing and that the U.S. recovery remains tepid at best. Convincing Canadians that they should prepare for higher interest rates in the absence of economic growth robust enough to warrant higher rates will be a challenge.

China has loosened its grip ever so slightly on the yuan, allowing the currency to swing 1 percent higher or lower from the government-set daily "parity" rate compared with a band of 0.5 percent that has been in place since 2007. The question is whether this is a big deal or not and currency traders and strategists appear uncertain. The fact is, trading in the yuan rarely tested the previous 0.5 percent band so why would it test the limits of the new band? Does the widening of the band signal a swifter move to a free-floating currency or is it just an easy, pain-free way to muzzle China's currency critics?

We're also watching earnings from Gannett, Mattel and Charles Schwab.

Among the interviews I'm looking forward to today is a conversation with Mike Wekerle, co-founder of Difference Capital and former head of trading at GMP. We'll find out what one of Canada's best and highest-profile traders is up to now and get his thoughts on the markets. He joins us at 5:30 p.m. ET.

Every morning Managing Editor Marty Cej writes a "chase note" to BNN's editorial staff listing the stories and events that will be in the spotlight that day.

AM Guest Line Up

7:00 AM - The Street Gang
Chris Watling, Chief Economist & Strategist, Longview Economics, and Bill Harris, Partner & Portfolio Manager, Avenue Investment Management

7:30 AM - The Future Of Energy Use
Ron Dembo, Founder & CEO, Zerofootprint

7:50 AM - Investing in 2050: Betting on a Water Boom
Kevin Bannon, Chief Investment Officer, Highmount Capital

8:20 AM - French Election Results
Brenda Kelly, Market Strategist, CMC Markets

8:45 AM - Citigroup Reports
Matt McCall, president, Penn Financial Group

9:10 AM - U.S. equity strategy
Sam Stovall, chief equity strategist, S&P Capital IQ

9:35 AM - What's Moving the Markets
John Zechner, Chairman, J. Zechner Associates

10:15 AM - Summit Of The Americas Debrief
Jim Prentice, Senior Executive Vice-President and Vice Chairman, CIBC

10:35 AM - Chip Earnings Preview
Patrick Wang, Managing Director, Semis, Evercore Partners

10:50 AM - Dividend & Income Strategy
Michael Clarfeld, Managing Director & Portfolio Manager, ClearBridge Advisors

11:00 AM - Valuing the Banks
Robert Sedran, Executive Director, Institutional Equity Research, Financial Services, CIBC World Markets

11:30 AM - Berman's Call with Andrew Bell

PM Guest Line Up

12:00 PM - The Business News with Catherine Murray

12:30 PM - Headline with Howard Green
News of the Day Panel: Brian Milner, Business Columnist, The Globe and Mail; and Randy Cass, Founder, Orchard Asset Management and Host, Market Sense
Samsung: Android's top seller: Paul Brannen, VP of Mobile Communications, Samsung Canada Why Android will out-compete Apple: Edward Zabitsky, CEO, ACI Research
How does Android stack up? Kevin Restivo, Senior Analyst, IDC Canada

1:30 PM - Market Call with Michael Hainsworth
Charles Dillingham, VP & Portfolio Manager, Morguard Financial
BNN takes your calls and emails about REITs.

3:00 PM - Business Day Featured Guest
Susan McArthur, senior investment banker, Jacob Securities

3:10 PM - Next-gen doctor-patient management
William Tatham, Chief Executive Officer, NexJ Systems

4:05 PM - Top Picks
Laura Wallace, VP & Portfolio Manager, Scotia Private Client Group

4:20 PM - Bank of Canada Preview
Charles St. Arnaud, Nomura

4:30 PM - Tips For Nat Gas Investors
Marin Katusa, Senior Market Strategist, Casey Research

4:50 PM - The Big Picture
Chris Hensen, Portfolio Manager, Manulife Asset Management

5:00 PM - Market Sense with Randy Cass, Andrew McCreath and Catherine Murray
Bull/Bear Debate: Orbite Aluminae: Jon Hykawy, Head of Global Research, Byron Capital Markets and Luisa Moreno, Jacob Securities
Market Sense Trade Talk: Ali Alagheband, Managing Director, DRI Capital
Bay Street Legend Makes a Comeback: Mike Wekerle, co-founder, Difference Capital and founding Partner & former Head of Trading at GMP and Wes Hall, Chairman TriNorth Capital
6:00 PM - Market Call Tonight with Mark Bunting
Hap Sneddon, Portfolio Manager & Technical Analyst, CastleMoore Inc.
BNN takes your calls and emails about technical analysis.

Investment Ideas

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"BNN Morning Newsletter: April 16, 2012"