|Bid||76.00 x 800|
|Ask||76.87 x 1100|
|Day's Range||76.32 - 77.20|
|52 Week Range||62.79 - 79.35|
|Beta (5Y Monthly)||1.10|
|PE Ratio (TTM)||12.53|
|Forward Dividend & Yield||3.19 (4.17%)|
|1y Target Est||85.95|
(Bloomberg) -- The Federal Reserve Bank of New York is getting its house in order, ramping up measures to combat end-of-year funding risks and tapping permanent leaders to steer its interactions with markets.The branch, which acts as the U.S. central bank’s eyes and ears on Wall Street through its markets group, on Thursday said it would conduct additional repurchase-agreement operations that could take the amount its support for funding markets over the crucial year-end period to more than half a trillion dollars. It also announced new senior leaders within that markets function, naming Daleep Singh as head of the group and appointing Lorie Logan to oversee the System Open Market Account.An announcement by the Fed Thursday means that the central bank is now planning to offer a total of $490 billion in liquidity via repo operations for the turn of the year, including the $75 billion that it has already pumped in through three earlier term actions. It announced new term operations totaling $365 billion that will take place this month and next, as well as various changes to its overnight actions.“The Fed either expects the take-up to be this large so they want to make sure that they provide that level or they just wanted to make sure everyone knew they weren’t going to undersize this,” said BMO Capital Markets strategist Jon Hill. “I wouldn’t expect this to be fully subscribed, but it should be comforting to market participants that this is available.”The Fed has been conducting repo offerings and Treasury-bill purchases in a bid to keep control of short-term interest rates and bolster bank reserves. And while that has calmed markets since the September spike that took overnight repo rates as high as 10%, concerns about the year-end period remain and participants have been flocking to Fed term offerings that will carry them through to January.Ready to ChangeFed Chairman Jerome Powell said Wednesday the central bank stands ready to adjust details of its repo operations as appropriate to keep the fed funds rate within the central bank’s target range.The Fed’s Dec. 16 operation is a 32-day offering with a maximum limit of $50 billion, while the other term actions range from 13 to 15 days with a maximum size of $35 billion, tenors it has used previously. Some of these will take place in January and do not provide year-end funding.The central bank also plans to adjust the size of some of its overnight repo operations. While the offering size will remain mostly unchanged at $120 billion, it plans to conduct a one-day forward settlement operation of $75 billion on Dec. 30 that settles on Dec. 31 and matures Jan. 2. The New York Fed will also increase the sizes of the overnight actions to $150 billion on Dec. 31 and Jan. 2.The New York Fed also announced its plans for Treasury-bill buying that it’s conducting as part of its reserve management regime, keeping the pace of purchases unchanged at $60 billion per month.New LeadersThe New York Fed’s markets division, which is responsible for implementing interest-rate and other decisions by the Federal Open Market Committee, has been without a permanent leader since June. That was when New York Fed President John Williams ousted longtime official Simon Potter over disagreements related to managerial strategy.Singh, the new markets boss, is a former U.S. Treasury official currently at investment firm SPX Capital, while Logan is a longtime staffer in the division who has been running SOMA as manager pro tem since Potter left. The branch also named Christopher Armstrong, who’s been at the New York Fed for 10 years, as head of the Financial Services Group. All three will have the rank of executive vice president.(Adds details on New York Fed appointments. An earlier version of this story was corrected to fix year-end liquidity figure in third paragraph and clarify timing of term operations.)\--With assistance from Nick Baker.To contact the reporters on this story: Alexandra Harris in New York at email@example.com;Matthew Boesler in New York at firstname.lastname@example.orgTo contact the editors responsible for this story: Benjamin Purvis at email@example.com, ;Alister Bull at firstname.lastname@example.org, Debarati RoyFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
As we already know from media reports and hedge fund investor letters, hedge funds delivered their best returns in a decade. Most investors who decided to stick with hedge funds after a rough 2018 recouped their losses by the end of the third quarter. We get to see hedge funds' thoughts towards the market and […]
TORONTO , Dec. 12, 2019 /CNW/ - To help customers gain better control of their financial lives, BMO has introduced a new personal financial management solution, BMO Insights. The solution leverages artificial intelligence (AI) to deliver personalized, automated, and actionable insights for everyday banking customers to help them manage their day-to-day finances and cash flow. BMO Insights will be fully integrated into the mobile banking experience.
TORONTO , Dec. 11, 2019 /CNW/ - BMO Financial Group (BMO.TO) (BMO) today announced it is providing Maple Leaf Foods Inc. the first sustainability-linked loan in Canada . The amendment to the existing credit facilities will allow Maple Leaf Foods to reduce the interest rate on the lending facility if it meets targets on electricity use, water use, solid waste and continuing to reduce its carbon emissions in line with its achievement of net carbon neutrality. BMO is the Sole Bookrunner on the existing credit facilities and will additionally act as a Sustainability Structuring Agent – working with Maple Leaf Foods to establish its targets.
(Bloomberg Opinion) -- Federal Reserve Chair Jerome Powell and his colleagues sent a message with their final interest-rate decision of 2019: Don’t expect us to be subject to the whims of America’s ever-shifting trade policy in the year ahead.The Federal Open Market Committee, in its first unanimous decision since May, kept its benchmark lending rate unchanged in a range of 1.5% to 1.75%. The median projection in the central bank’s “dot plot” calls for no movement in the fed funds rate during the next 12 months, with 13 of 17 central bankers expecting to hold steady. All of this conforms with market expectations — after last week’s blockbuster jobs report, fed funds futures began to price out additional interest-rate cuts in 2020.How the Fed opted to reword its statement heading into the New Year was perhaps the most striking takeaway from a decision that otherwise went as expected. Notably, it says “the committee judges that the current stance of monetary policy is appropriate to support” its goals and no longer contains the phrase “uncertainties about this outlook remain.” The central bank will continue to monitor “global developments” — its way of saying “trade wars” — but no longer views them as detrimental to the U.S. economy.“This was a telling change given there is still no clarity on the trade front,” Ian Lyngen, head of U.S. rates strategy at BMO Capital Markets, wrote after the decision. “Perhaps Powell is also suffering from ‘trade drama fatigue?’”It has been quite a year for Powell. At the beginning of 2019 he effectively told markets the Fed would be on hold just weeks after policy makers predicted two additional interest-rate increases in the coming 12 months. By June, bond traders were convinced the central bank would begin dropping interest rates in the following month. Now the fed funds rate is 75 basis points lower than in January. “That wasn’t in the plan in any kind of specific way in the beginning,” Powell noted in his press conference.Powell may never say it, but the Fed was pushed around in a large way by the Trump administration’s trade policy. He said that “we try to look through the volatility in trade news” and that “monetary policy is not the right tool to react in the very short term to volatility and things that can change back and forth.” Either way, the central bank seems to believe it offset any threat that posed to the U.S. economy through its interest-rate cuts.But heading into a U.S. presidential election year, the Fed truly wants to be on hold. And with this decision, it sought to make clear that it’s going to take more than just escalating trade rhetoric to get policy makers to change that view — in Powell’s words, only “if developments emerge that cause a material reassessment of our outlook, we would respond accordingly.”Now, whether markets take this stance seriously is anyone’s guess. But it’s worth looking back at previous election years to see how resistant the Fed has been to abruptly changing course.Many market observers seem to think the Fed doesn’t move interest rates one way or the other during an election year. That’s not entirely correct. Sure, the central bank did nothing in 2012, but in 2008 it dropped the fed funds rates by 225 basis points in the first half of the year and raised interest rates in both early 2000 and starting in mid-2004. As Carl Riccadonna of Bloomberg Economics put it: “A fundamental law of physics proves to be a useful rule of thumb for Fed policy in election years: Objects at rest will stay at rest and objects in motion will remain in motion.”Here’s more from Riccadonna’s analysis:“While the Fed is averse to any appearance of influence over political outcomes, it is not unprecedented to adjust policy in election years. What is unusual is a change of course or velocity of adjustments. … Policy makers attempt to maintain the status quo on policy through elections. If they were on hold in the preceding period, they remain on hold; if they are hiking gradually and predictably, they continue to do so, and so forth.”Of course, the Fed has never faced the level of persistent attacks from a U.S. president as it has with Donald Trump. In some ways, it’s almost too late to avoid politicizing the central bank. But there’s long been a theory in financial markets that Trump would keep escalating trade tensions with China, which would cause the Fed to further drop interest rates, and then the president would strike a deal at the last minute and cause a stock rally to buoy his re-election chances. Powell is acutely aware that markets are obsessed with these trade talks. “What’s been moving financial markets? It’s been news about the negotiations with China,” Powell said. With this decision, Powell is telling Trump and traders that they can’t have it all in 2020. The economy is in a good place, thanks to the Fed’s decisive action to lower rates three times. If the president wants to keep the good times going in 2020, the ball is in his court. The central bank will be watching from the sidelines.To contact the author of this story: Brian Chappatta at email@example.comTo contact the editor responsible for this story: Daniel Niemi at firstname.lastname@example.orgThis column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.Brian Chappatta is a Bloomberg Opinion columnist covering debt markets. He previously covered bonds for Bloomberg News. He is also a CFA charterholder.For more articles like this, please visit us at bloomberg.com/opinion©2019 Bloomberg L.P.
U.S. traders looking to actively trade cannabis stocks have a new instrument to use in their trading toolkit. REX Shares, a Connecticut-based provider of exchange-traded products, announced today the launch of the MicroSectors Cannabis 2x Leveraged ETN (MJO), the first U.S.-listed leveraged cannabis product. “There is a void in the market for trading products around cannabis,” said Scott Acheychek, president of REX Shares.
REX Shares, LLC (REX) today added to its MicroSectors™ lineup with the launch of MJO, the first leveraged exchange-traded product in the U.S. linked to the cannabis industry. MJO, an Exchange-Traded Note (ETN), is linked to MSMJ, the Indxx MicroSectors™ North American Cannabis Index, and will seek to provide 2x leveraged exposure to the Index.
Toronto-Dominion Bank (TD) fourth-quarter fiscal 2019 results reflect higher revenues, partly offset by rising expenses and higher provisions.
(Bloomberg) -- Treasury yields rose and traders stepped back from fully pricing in a quarter-point rate cut from the Federal Reserve next year after November U.S. job growth trounced expectations.The benchmark 10-year yield rose 3 basis points to 1.84%, and is now up about 7 basis points on the week. The Bloomberg Dollar Spot Index gained 0.2%, putting it on track to halt a five-day slide.The surprising labor-market strength may ease concern that U.S. growth is faltering amid global economic headwinds from the trade war. While traders still see the Fed having to lower borrowing costs, they’re now betting that reduction won’t come until 2021. That’s compared with the second half of 2020 before Friday’s data. Fed officials, for their part, have been signaling they intend to pause after three consecutive rate cuts this year.“In the last month or so, the recession narrative has started to disappear,” said Tony Farren, managing director at broker-dealer Mischler Financial in Stamford, Connecticut. “This completely eliminates it” unless U.S.-China trade talks deteriorate.White House economic adviser Larry Kudlow on Friday said the U.S. and China are “still close” to reaching a phase-one trade agreement.The benchmark U.S. 10-year rate may rise to 1.92% in the next week, the highest since mid-November, Farren said.The yield retreated a bit after peaking at 1.86% Friday.Market reaction to the report “is somewhat muted, likely due to the myriad of major risks in the next 10 days,” according to BMO strategist Jon Hill.That period includes Fed and European Central Bank decisions, the U.K. election and the Dec. 15 deadline for the U.S. to impose more tariffs on China.\--With assistance from Emily Barrett.To contact the reporters on this story: Vivien Lou Chen in San Francisco at email@example.com;Alexandra Harris in New York at firstname.lastname@example.orgTo contact the editors responsible for this story: Benjamin Purvis at email@example.com, Mark Tannenbaum, Greg ChangFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
Canada’s biggest banks are facing a storm of challenges, with a slowdown in consumer spending and a dearth of public listings pushing some big lenders to make hefty job cuts as their profitability falters. The decision by Bank of Montreal (BMO), Canada’s fourth-largest bank, to slash its global workforce by 5 per cent highlights the growing problems facing the country’s financial services sector. BMO this week announced a pre-tax charge of C$484m ($360m) for the three months to the end of October, pushing net income down 30 per cent year on year to just under C$1.2bn.
(Bloomberg) -- Bank of Montreal is exploring transition funding for a carbon-capture project as it seeks to mobilize C$400 billion ($301 billion) for sustainable finance by 2025.Transition financing helps companies finance the move to less carbon-intensive operations. Last week, Credit Agricole CIB became the world’s first commercial bank to issue a transition bond.“We are talking to a number of people about that but I don’t have a project that I could announce,” Dan Barclay, chief executive officer and group head of BMO Capital Markets, said in an interview in Toronto. It’s not clear if BMO would help finance the project or underwrite the debt.Canada’s financial industry is pushing to allow its energy sector to tap sustainable financing to back projects that cut carbon emissions. Some banks already use issues with the environmental, social and governance label to do the same. Global discussions are underway to set standards for financing that meet environmental, sustainable and governance goals.Canada will likely see its first transition financing in 2020, Barclay said.“I am very hopeful to see something during fiscal year ‘20,” Barclay said on the sidelines of Bloomberg’s Canadian Sustainable Investment Forum in Toronto. “I don’t have one yet, to put on the table, but I’m hoping to, soon.”Credit Agricole sold a 100 million euro ($110 million) transition bond which will finance the switch from coal-fired power to natural gas in Chile, and convert maritime shipping to natural gas from bunker fuel, the lender said in a Nov. 27 statement. The 10-year bond, privately placed with AXA IM, will pay a coupon of 0.55%.“Green is a certain type of financing but what I think could be more appropriate for Canada is transition bonds,” Paul Bowes, country head at FTSE Russell Canada said at the forum. “This is not a gold rush, this is fundamental.”Earlier this year, BMO set new targets for sustainability and inclusivity that included doubling the Toronto-based lender’s sustainable finance. Of the C$400 billion, the bank aims to provide C$150 billion in capital to companies pursuing sustainable outcomes.The bank’s global asset management arm already advises or oversees about C$150 billion of sustainable assets and the bank has raised about C$20 billion in capital for sustainable finance, said Barclay.“This is one of the defining issues over the next decade,” said Barclay.To contact the reporters on this story: Esteban Duarte in Toronto at firstname.lastname@example.org;Divya Balji in Toronto at email@example.comTo contact the editors responsible for this story: Nikolaj Gammeltoft at firstname.lastname@example.org, ;David Scanlan at email@example.com, Jacqueline ThorpeFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
(Bloomberg) -- The Bank of Canada struck an upbeat tone Wednesday, citing evidence of a stabilizing global economy and a resilient domestic backdrop that gives little indication policy makers are in a rush to lower borrowing costs.The Ottawa-based central bank held its benchmark interest rate at 1.75% for a ninth consecutive meeting, retaining language from its previous statement that it judges the current level to be “appropriate.” The prolonged pause has left Canada with the highest policy rate among advanced economies.The decision showcases a Bank of Canada still comfortable with its wait-and-see stance, maintaining its outlier status in a period of global monetary easing. In the statement, officials said the October projection for a recovery in global growth “appears to be intact,” even as international trade disputes remain the biggest source of risk. It characterized domestic economic conditions, driven by consumers and housing, as resilient.“Future interest rate decisions will be guided by the Bank’s continuing assessment of the adverse impact of trade conflicts against the sources of resilience in the Canadian economy,” policy makers led by Governor Stephen Poloz said in the statement.“There is nascent evidence that the global economy is stabilizing,” officials said, adding they expect global growth to edge higher over the next couple of years.The Canadian dollar extended gains on the decision, up 0.6% to C$1.3219 per U.S. dollar at 10:20 a.m. Toronto time, as investors pared bets on future cuts. Yields on two-year Canadian government bonds also jumped, trading at 1.62%, from 1.56% on Tuesday.“It’s steady as she goes for Captain Poloz,” Benjamin Reitzes, an economist at Bank of Montreal, said in a note to investors. “Today’s statement can be characterized as glass half full.”All 27 economists surveyed by Bloomberg expected the Bank of Canada to hold on Wednesday, though many see the bank eventually cutting borrowing costs as early as the first quarter next year. Markets are still pricing in a two-thirds chance of a rate cut over the next 12 months.Analysts characterized the statement as less dovish than the previous statement in October, when the central bank highlighted global risks and Poloz acknowledged the central bank had considered the merits of an insurance cut. While there was no reference to that in Wednesday’s statement, Deputy Governor Tim Lane will provide more insight into the deliberations in a speech Thursday.“Today’s statement dialed back the dovish rhetoric of the prior statement, and as such suggests that the BoC is pretty firmly on hold for now,” Andrew Grantham, an economist at CIBC World Markets, said in a note.On the global outlook, policy makers said financial markets are being supported by easing measures by other central banks, and “waning recession concerns.” And while trade uncertainty persists, the Bank of Canada noted commodity prices and the currency have been stable.Investment MomentumDomestically, the central bank said gross domestic product came in as expected in the third quarter, driven higher by consumption and housing, as well as unexpected strength in investment. Policy makers, who had expected a decline in capital spending in the second half, said they will assess the extent to which the pickup “points to renewed momentum” in investment.The Bank of Canada reiterated that the recent record of core inflation around 2% is consistent with an economy operating near capacity. While inflation is expected to pick up in coming months, the acceleration should be temporary due to year over year movements in gasoline prices.One thing constraining the central bank is debt. Credit growth and real estate activity are re-accelerating in the second half of this year, propelled in part by lower interest rates imported from abroad, and any additional stimulus by the Bank of Canada could fuel risks.“The bank continues to monitor the evolution of financial vulnerabilities related to the household sector,” they said in the statement.(Updates with analyst comments in sixth and ninth paragraphs)To contact the reporters on this story: Erik Hertzberg in Ottawa at firstname.lastname@example.org;Theophilos Argitis in Ottawa at email@example.comTo contact the editors responsible for this story: Theophilos Argitis at firstname.lastname@example.org, Chris Fournier, Stephen WicaryFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
British fund manager M&G Investments suspended dealing in its flagship UK property fund on Wednesday, blaming Brexit uncertainty and weakness in the retail sector for a surge in investor requests to cash out. The suspension comes hot on the heels of the high-profile meltdown of investment veteran Neil Woodford's equity income fund and applies further pressure on regulators to increase investor protections on open-ended funds.
(Bloomberg) -- Bank of Montreal’s drive to improve efficiency has come with a cost: C$357 million, along with the most dramatic job cuts by a Canadian bank in more than 15 years.The lender took the charge, which was C$484 million ($364 million) before taxes, mostly for severance payments. The cuts will affect about 5% of Bank of Montreal’s workforce, executives said on a fiscal fourth-quarter conference call Tuesday. That would equate to about 2,300 positions, based on the company’s year-end headcount.“This is a sizable move,” Chief Executive Officer Darryl White said on the call, while announcing earnings that beat analysts’ expectations. “We’re on a new path as far as a continuous improvement of the operating efficiency of the bank and this charge is designed to accelerate that path as we go forward.”The latest restructuring charge -- which follows one taken in the second quarter of 2018, also tied to severances -- included a small amount of real-estate related costs and is part of White’s efforts to improve productivity at what has been Canada’s least-efficient bank. The company’s adjusted efficiency ratio, a measure of what it costs to produce a dollar of revenue, was 60% in the fourth quarter, down from 62.2% a year earlier, as the lender moves toward White’s target of 58% or better by the end of fiscal 2021.“It is difficult for us to credit good expense control in the face of yet another restructuring charge from this bank, this time approaching C$500 million,” CIBC Capital Markets analyst Robert Sedran said in a note to clients. “However, the underlying segment performance was solid with improving volume growth, positive operating leverage and stable credit quality. A decent result.”Bank of Montreal shares fell 1.8% to C$98.88 at 9:38 a.m. in Toronto. They have gained 11% this year, compared with a 13% increase for Canada’s eight-company S&P/TSX Commercial Banks Index.The job cuts are across all areas of the bank and are deeper than previous rounds of reductions, including the elimination of 1,850 jobs, or 4% of the workforce, in May 2016, and the 1,000 positions cut in 2007. The latest move comes about six months after the Toronto-based company pared about 100 jobs across its capital-markets division.The reductions surpass Bank of Nova Scotia’s 1,500 job cuts, announced in 2014, and the 1,660 positions eliminated by Royal Bank of Canada in 2004. Those were among the Canadian banking industry’s biggest cuts in the past two decades.Bank of Montreal’s restructuring costs contributed to a 30% decline in net income in the quarter, with the company posting earnings of C$1.19 billion, or C$1.78 a share. Adjusted per-share earnings were C$2.43, beating the C$2.41 average estimate of 14 analysts in a Bloomberg survey. The bank raised its quarterly dividend 2.9% to C$1.06 a share.Wealth ManagementWealth management led profit growth in the quarter, with a 22% increase in earnings from the year earlier, while Canadian and U.S. banking also gained. Earnings from the company’s BMO Capital Markets unit fell 9.7% amid a tougher year for dealmaking.Also in the earnings announcement:Wealth management had its best quarter for profit growth since last year, with earnings of C$267 million, helping lift annual net income to C$1.06 billion. The bank aims to get C$2 billion in annual profit from wealth management by 2023.Earnings from Canadian personal-and-commercial banking, Bank of Montreal’s biggest business, rose 6.2% to C$716 million.In the U.S. banking division, which includes Chicago-based BMO Harris Bank, earnings climbed 5.6% to C$393 million in the quarter, even after the impact of Federal Reserve interest rate cuts. Net interest margins in the U.S. division narrowed to 3.35%, the lowest since at least 2010.Earnings from BMO Capital Markets fell 9.7% to C$269 million on a decline in revenue from investment banking fees and trading.(Updates with size of cuts starting in first paragraph, shares in sixth.)To contact the reporter on this story: Doug Alexander in Toronto at email@example.comTo contact the editors responsible for this story: Michael J. Moore at firstname.lastname@example.org, ;David Scanlan at email@example.com, Daniel Taub, Steve DicksonFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
Bank of Montreal (TSX:BMO) (NYSE:BMO) today announced that its Board of Directors declared a quarterly dividend of $1.06 per share on paid-up common shares of Bank of Montreal for the first quarter of fiscal year 2020 ("Q1 2020 Dividend"), a 3 cent increase from the previous quarter and up 6 per cent from the prior year.
Bank of Montreal (BMO) delivered earnings and revenue surprises of 1.10% and 4.59%, respectively, for the quarter ended October 2019. Do the numbers hold clues to what lies ahead for the stock?
Bank of Montreal reported a drop in fourth-quarter net profit on Tuesday, driven by severance costs to cut about 5% of its workforce, even as earnings excluding the one-time items beat expectations. The cuts are part of Chief Executive Darryl White's strategy to lower the bank's efficiency ratio, which measures non-interest expenses as a percentage of revenues. BMO's adjusted efficiency ratio fell to 60% in the fourth quarter, from 62.2% a year earlier.
The cuts are part of Chief Executive Darryl White's strategy to lower the bank's efficiency ratio, which measures non-interest expenses as a percentage of revenues. BMO's adjusted efficiency ratio fell to 60% in the fourth quarter, from 62.2% a year earlier. "It's generally accepted that BMO is behind the others in this area," said John Kinsey, portfolio manager at Caldwell Securities, adding that banks' investments in technology portend more job cuts across the industry.