Here are five things you need to know this morning
Steely resolve: Here we go again. After postponing his much-ballyhooed tariff plans for Canada until next month, U.S. President Donald Trump threw another wrench into the plans over the weekend, announcing his intention to slap a 25 per cent tariff on all steel and aluminum imports into the U.S. Speaking to reporters on Air Force One, Trump said the metal tariffs would apply to imports from all countries, including Canada. The U.S. relies on a massive amount of aluminum imports to meet domestic demand, with 2023 data suggesting as much as 80 per cent of the metal used in the United States came from abroad. Steel imports are less of a factor in terms of overall consumption but are nonetheless critical in some sectors like aerospace. As is often the case with Trump, the details of the plan are far from clear, but expect a reaction in the metals market today, as buyers and sellers scramble to find and secure economical supply.
TD to divest Charles Schwab stake for US$14B: TD Bank is planning to raise about US$14 billion by selling its entire 187-million-share stake in U.S. money manager Charles Schwab. The two companies made the announcement in separate releases this morning. Schwab says it plans to buy up to $1.5 billion of the shares, while TD says it will use $8 billion of the proceeds to buy back shares of its own.
Punted capital gains tax changes net Ottawa a one-time windfall: It’s anyone’s guess as to whether or not Ottawa’s proposed changes to Canada’s capital gains tax regime will ever see the legislative light of day, but the plan that started being rolled out last summer has nonetheless netted Ottawa a short-term windfall. The original plan called for the higher inclusion rate to be in place as of last June, which prompted many taxpayers to plan accordingly and sell assets under the old, lower rate. Those deals created what the finance department calls a “greater volume of capital gains” than normal, Bloomberg reports this morning. Which means that even if the new tax changes never come in, Ottawa will still pocket a one-time windfall from those transactions. The flip side is that the approximately $10 billion of additional revenues it was earmarking for this year and next will never happen.
McDonald’s earnings show sluggish U.S. demand: We will be watching shares in McDonald’s today, after the ubiquitous fast-food chain posted quarterly results before the bell. The company said its same store sales grew by more than four per cent internationally, offsetting a 1.4 per cent decline in the U.S. Overall, the figure amounted to a 0.4 per cent uptick. The U.S. sluggishness didn’t come as a surprise, since the period in question included the weeks of an e coli outbreak in the U.S. southwest, a time when dozens of locations were temporarily closed. Shares are up slightly this morning.
Air Transat scraps free carry-on for cheapest fares: Air Transat has become the latest airline to tinker with its baggage fees, announcing over the weekend that it will no longer allow carry-on bags for its low-fare customers on most flights. Starting tomorrow morning, anyone wishing to have a carry-on bag in the Eco Budget and Eco Promo fare classes will have to check them for a fee of between $35 and $50.
