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Today’s top headlines

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9:00 a.m.

Suncor to buy Total’s Fort Hills oilsands stake in $1.47-billion deal

Suncor Energy Inc. agreed to buy TotalEnergies SE’s stake in the Fort Hills oilsands mine for $1.47 billion after an earlier deal to buy the French company’s Canadian assets was thwarted by ConocoPhillips Co.

The deal for TotalEnergies’ roughly 31 per Cent working interest in Fort Hills would add 61,000 barrels a day of bitumen production capacity and 675 million barrels of reserves, Calgary-based Suncor said Oct. 4. The deal is expected to close this year.

For Suncor, the purchase would secure long-term bitumen supplies for the upgraders at its Base Plant, prolonging the operation’s lifespan. The company has been searching for new supplies for the facilities after the Canadian government signalled last year that it might not approve a project to extend the life of the mine that currently feeds them. The transaction addresses a “key uncertainty for the company,” Suncor chief executive Rich Kruger said in a statement.

“They get the bitumen feed that they will need post-2030, when their Base Plant runs out,” Phil Skolnick, an analyst at Eight Capital, said in an interview.

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For TotalEnergies, the sale speeds its shift to operations with lower costs and helps fund share buybacks. The company is also ramping up investments in reducing its emissions and generating carbon-free energy.

TotalEnergies’ exit marks the latest in a string of divestitures by international oil companies from the oilsands. Companies including Shell PLC, BP PLC and Equinor ASA have sold assets in the region to Canadian companies amid an increased focus on cutting emissions.

Bloomberg

Read the full story here.

8:25 a.m.

India wants Canada to cut number of diplomats as tensions simmer

India said Thursday it wants parity with Canada on diplomatic presence, indicating that Ottawa should reduce the number of its officials in the country amid tensions over the killing of a Sikh separatist leader.

Both countries are still in discussions “on the modalities of achieving this,” Arindam Bagchi, a spokesperson for India’s Ministry of External Affairs, told reporters in New Delhi.

“We have sought parity in diplomatic presence,” he said. “Canadian diplomatic presence is very much higher. We would assume that there would be a reduction.”

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The development follows comments on Tuesday from Canadian Foreign Minister Melanie Joly, who underlined the need for a strong diplomatic footprint in India during times of conflict. Joly said Canada is in “constant co-operation and dialogue with India” to address the issue.

The Financial Times reported earlier this week that Prime Minister Narendra Modi’s government told Canada it must repatriate 41 diplomats — out of 62 currently in India — by Oct. 10. The Canadian government has an embassy in New Delhi and consulates in Bengaluru, Chandigarh and Mumbai.

Ties between the nations fell to their lowest point in decades after Prime Minister Justin Trudeau linked Indian agents with assassinating a prominent Sikh leader in Canada. New Delhi has called the allegations “absurd” and denied involvement in the June 18 shooting of Hardeep Singh Nijjar, a Canadian citizen who was pushing for an independent Sikh homeland in India.

Eltaf Najafizada and Sudhi Ranjan Sen, Bloomberg

7:45 a.m.

Elon Musk strips headlines from news organizations’ posts on X

Elon Musk has made good on a promise to strip out headlines from news organizations’ posts on the X Corp. platform formerly known as Twitter.

The change, which began rolling out yesterday, means some users will now only see the post and lead image associated with the story it links to. To access the story itself, users have to click on the image shown.

Musk said in August the move would “greatly improve esthetics.”

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The change is the latest in a long line for the platform Musk took over in 2022. Two weeks ago, he floated making all users pay a monthly subscription fee in a bid to thwart bot operations.

Alex Millson, Bloomberg

7:35 a.m.

Montreal home sales rise 9% in September

The Quebec Professional Association of Real Estate Brokers says Montreal home sales in September rose nine per cent compared with a year ago, but remained below the historic average for the time of year.

The association says home sales in Montreal totalled 2,738 in September, up from 2,514 in the same month last year.

Single-family home sales totalled 1,391, up from 1,324 a year ago, while condominium sales amounted to 1,068, up from 944 in September 2022. Plex sales came in at 276, up from 245 a year earlier.

Active listings totalled 16,398 in September, up 10 per cent from 14,916, while new listings for the month fell two per cent to 5,872, compared with 5,984 a year earlier.

The median price of a single-family home in Montreal was $549,000, up three per cent from a year ago, while the median condominium price was $402,000, up six per cent.

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The median plex price was $730,000, up seven per cent from a year ago.

The Canadian Press

7:30 a.m.

BlackBerry to spin off Internet of Things business, hold IPO

BlackBerry Ltd., wrapping up a strategic review of its options, plans to hold an initial public offering for the company’s Internet of Things division, separating the business from its main cybersecurity operations.

The split is expected to occur in the first half of the next fiscal year, the Canadian company said in a statement Oct. 4. BlackBerry’s fiscal calendar runs through February.

The board undertook the review with advisers Morgan Stanley and Perella Weinberg Partners, and they concluded that an IPO was the best option for the IoT business, the company said. The internet of Things market is focused on infusing online capabilities and sensors into appliances, cars and everyday items.

Investors applauded the move, sending the shares up more than five per cent in late trading on Wednesday. The entire company currently has a market valuation of about US$2.5 billion.

“BlackBerry believes that a separately traded IoT subsidiary will enable shareholders to more clearly evaluate the performance and future potential of BlackBerry’s principal businesses on a stand-alone basis, while allowing each business to pursue its own distinct strategy and capital allocation policy,” the Waterloo, Ontario-based company said.

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BlackBerry, the phone giant turned security software provider, announced the review in May, and uncertainty around the process has compounded concerns about the company’s financial performance.

Veritas Capital has been seen as a possible suitor for BlackBerry. Bloomberg reported in August that the private equity firm was contemplating making a bid for the whole company.

The company lost US$42 million in the second quarter of its 2024 fiscal year as revenue from Internet of Things rose four per cent while cybersecurity revenue was down 40 per cent.

Nick Turner, Bloomberg, with additional reporting from The Canadian Press

Stock markets: Before the opening bell

Global markets steadied on Thursday, with United States equity futures and bonds trading slightly weaker as investors looked ahead to data on the labour market.

Contracts on the S&P 500 dipped 0.3 per cent and the yield on 10-year Treasuries edged up to 4.74 per cent. The U.S. dollar was steadied, while West Texas Intermediate crude held around US$84 a barrel.

Investor sentiment remains fragile after wild moves across markets this week driven by U.S. bond yields, the reference rate for the global cost of capital, soaring to multi-year highs. Weekly U.S. jobless claims data is due later today, and the monthly payrolls report will be released on Friday, which could cement bets on a November interest rate hike. Currently, swaps price a one-in-four chance of a United States Federal Reserve move next month.

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“Friday’s payrolls data, and next week’s inflation number will decide whether the 10-year Treasury yield goes up to five per cent or down to 4.5 per cent,” Societe Generale strategist Kenneth Broux said. A higher-than-forecast jobs number could trigger “another wave of dollar-buying and bond-selling,” he added.

Even with markets showing sign of calm, strategists reports have highlighted the deep concern about the long-term economic toll of higher-for-longer interest rates. Barclays Plc analysts wrote in a note that global bonds are doomed to keep falling unless a sustained slump in equities revives the appeal of fixed-income assets.

“There is no magic level of yields that, when reached, will automatically draw in enough buyers to spark a sustained bond rally,” analysts led by Ajay Rajadhyaksha said. “In the short term, we can think of one scenario where bonds rally materially. If risk assets fall sharply in the coming weeks.”

On Wednesday, the S&P/TSX composite index closed up 13.89 points at 19,034.81. Here were the top movers of the day on the index.

In the U.S., the S&P 500 climbed 0.8 per cent, closing at 4,263.75. The Dow Jones industrial average added 0.4 per cent to 33,129.55 and the Nasdaq jumped 1.4 per cent to 13,236.01.

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Bloomberg

What to watch today

Statistics Canada will release merchandise trade balance data at 8:30 a.m.

The United States releases more labour market data this morning with the Challenger layoff report and initial jobless claims. Also on tap is the goods and services trade balance, along with the global supply chain pressure index for September.

The Quebec Professional Association of Real Estate Brokers will provide fresh data on Montreal’s housing market in September.

The Competition Bureau hosts Canada’s Competition Summit 2023 in Ottawa. Industry Minister François-Philippe Champagne delivers opening remarks.

The Canada Mortgage and Housing Corp. will release its biannual Housing Supply Report. The report will provide a detailed analysis of new housing construction trends in Canada’s six largest census metropolitan areas.

NDP Leader Jagmeet Singh will speak to media about his plan to lower food prices this afternoon.

The Canadian Club hosts a conversation on the decarbonization of the aerospace industry with industry leaders at the Fairmont Royal York Hotel in Toronto.

On the earnings front, Constellation Brands Inc., ConAgra Foods Inc. and Richelieu Hardware Ltd. are among companies reporting.

Need a refresher on yesterday’s top headlines? Get caught up here.

Additional reporting by The Canadian Press, Associated Press and Bloomberg

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