Noah Zivitz

Managing Editor, BNN Bloomberg

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Despite a weekend of headlines about Omicron’s spread (including cases in Canada), there’s some calm in markets today after Friday’s sell-almost-everything washout. Notably, West Texas Intermediate crude has been up as much as 5.9 per cent after sinking 13 per cent on Friday amid fear that the new COVID variant will decimate demand. Meanwhile, futures are pointing to a higher open when trading starts in New York. We heard many times on Friday that today’s session would be crucial after U.S. Thanksgiving made for less than ideal trading-desk staffing on Friday when Omicron shook global markets; we’ll see if today’s early rally holds.

VACCINE MAKERS EASING FEARS

One of the reasons for relative calm across markets today is an encouraging tone from vaccine makers. Moderna Chief Medical Officer Paul Burton told the BBC that if a brand new vaccine is necessary to defend against Omicron, it could be ready in early 2022. “The remarkable thing about the mRNA vaccines, the Moderna platform, is that we can move very fast,” Burton said. And BioNTech said today it’s working with Pfizer to adapt their COVID vaccine to deal with Omicron. Our Bloomberg Television partners are speaking with Pfizer’s CEO this afternoon; watch for highlights from that interview on BNN Bloomberg.

ENBRIDGE ON “MANAGEABLE” REGULATORY SETBACK

The pipeline operator is dusting itself off after the Canada Energy Regulator on Friday denied its application to convert the Mainline pipeline system to a long-term contract model. In a release yesterday, Enbridge said it will “re-engage with stakeholders” to determine how it will manage the flow across Canada’s largest oil pipeline network. And that’s going to be a long process, with the company saying it’s likely going to be 2023 when the CER rules on its next application. In the interim, Enbridge attempted to assuage investor concerns: “Based on our review of the CER decision and other factors, the company anticipates that the range of financial outcomes associated with an alternative commercial model will be manageable and is not expected to materially impact Enbridge's financial results,” it said in the release.

BANK EARNINGS/DIVIDENDS/BUYBACKS EVE  

We’ve been preoccupied with credit quality heading into every round of earnings for Canada’s Big Six banks since the start of the pandemic. There’s a different storyline to watch heading into the reporting cycle that starts tomorrow with Bank of Nova Scotia, as investors and analysts wait to see how lenders take advantage of newfound freedom to raise their dividends and buy back shares. Most of the talk thus far has been focused on the potential for a “tsunami of dividends.” But let’s remember that Scotia CEO Brian Porter has repeatedly told us his team is ready and waiting to repurchase its shares. We’ll set the scene today, including with Veritas Analyst Nigel D’Souza at 2:30 p.m.

OTHER NOTABLE STORIES

• We’re waiting for an update from Canadian National Railway on the status of its service between Vancouver and Kamloops. Trans Mountain, meanwhile, is now aiming to get oil flowing in its namesake pipeline “early to mid-week,” it said late Friday afternoon.
• The Ed Sims era is over at WestJet. We knew he was going to retire, we just didn’t know the precise timing. This morning, the airline confirmed that Harry Taylor has assumed the duties of president and chief executive officer on an interim basis.
• Vermilion Energy is bringing back a dividend. Almost two years after halting payments in the early days of the pandemic, the oil and gas producer said it’s expecting to start a quarterly payment of six cents per share in April 2022. That decision was made alongside news that Vermilion is buying Equinor’s stake in the Corrib natural gas field in Ireland.
• Here’s today’s reminder of inflation: StatsCan’s industrial product price index surged 16.7 per cent year-over-year in October, which included a 72 per cent surge for energy and petroleum products. 

NOTABLE RELEASES/EVENTS

• Notable data: Canadian current account balance, industrial product price index, and monthly estimate of business openings/closings
• 9:00: Financial Accountability Office of Ontario releases report on province’s spending
• 11:45: U.S. President Joe Biden delivers remarks at the White House on Omicron variant
• 14:00: Bank of Canada Governor Tiff Macklem delivers opening remarks at inaugural Symposium on Indigenous Economies
• 14:00: U.S. President Joe Biden "meets with the CEOs of companies in a variety of sectors to discuss the holiday shopping season and his Administration’s work to move goods to shelves"
• 17:05: Bank of Canada Deputy Governor Lawrence Schembri participates in panel at inaugural Symposium on Indigenous Economies
• MEG Energy announces 2022 capital investment plan