Canada, G7 urge 'all parties' to de-escalate in growing Mideast conflict
Canada called for "all parties" to de-escalate rising tensions in the Mideast following an apparent Israeli drone attack against Iran overnight.
Foreign investors are growing more worried that Canada's federal election on Monday could result in a deadlock that hampers Ottawa's response to the COVID-19 pandemic and further slows the economic recovery from the crisis.
Polls show Justin Trudeau's centre-left Liberals virtually tied with the opposition Conservatives ahead of the Sept. 20 vote, raising the prospect that no party will be able to form even a stable minority government. Adding to the uncertainty is an expected increase in mail-in voting that could delay the counting of ballots in some key electoral ridings.
Financial markets generally view Canadian elections from the vantage point of which of the big parties would be most friendly for investors, but that tendency may take a backseat this time to the desire to have a government quickly in place in a crisis.
The results of Canadian elections typically are known within hours of the polls closing. Even when no party has won a majority of the seats, it is usually clear which will form the government and what the general policy priorities will be.
An outcome "that leads to a gridlocked government is going to complicate the recovery going forward, and I think that's why you are probably going to see some (investor) hesitancy ahead of the election," said Edward Moya, senior market analyst at OANDA in New York.
"Right now, we're in the process of an economic recovery that needs everything to line up nicely."
Trudeau, who has been prime minister for six years, has relied on the backing of the New Democrats since failing to win a majority of the seats in the House of Commons in the 2019 election. Polls show the smaller left-leaning party poised to do better on Monday, with enough support perhaps to compel the Liberals to tilt to the left if they wish to remain in power.
Trudeau's government has spent billions of dollars to stem the fallout from the pandemic, while the Bank of Canada has cut interest rates and purchased bonds to stimulate the economy. Although the central bank has vowed to keep its key interest rate at a record low of 0.25% until economic slack is absorbed, troubling signs have appeared on the horizon.
Canada's economic growth slowed in the second quarter and annual inflation spiked in August to an 18-year high, taking some of the wind out of the sails of the Liberal leader's economic argument for reelection.
The Canadian dollar has fallen 1.1% to about 1.2650 per U.S. dollar, or 79.05 U.S. cents, since Trudeau called the election in mid-August, and speculators have turned bearish on the currency for the first time since last December.
The market's measure of expected volatility for the currency over a one-week period, a timeframe that covers the election, has climbed to an annualized rate of about 7.5% from less than 5% in August.
The Toronto Stock Exchange's S&P/TSX composite index , the country's main stock index, fell 1.7% on Tuesday to its lowest closing level in nearly three weeks, while an index showing implied volatility for the Toronto stock market hit its highest closing value since Aug. 23.
Equities investors are casting a nervous eye over some of the campaign promises made by the parties, including Trudeau's vow to raise corporate taxes on the most profitable banks and insurers to help pay for the cost of the recovery and his pledge to immediately cap oil and gas emissions.
"If it started to lean towards a Liberal majority I would begin to sell energy and banks," said Greg Taylor, a portfolio manager at Purpose Investments in Toronto.
There is also nervousness over a promise by the Conservatives, the main opposition party, to increase foreign competition in the telecommunications sector as well as a pledge by the Liberals to curb excessive profits from rental housing, which could hurt real estate investment trusts.
"There is a lot of political posturing and rhetoric," said Russil Lea, a portfolio manager at Nicola Wealth in Vancouver. "The race looks very tight and the only certainty right now is uncertainty as far as how the election will go."
(Reporting by Fergal Smith Editing by Denny Thomas and Paul Simao)
Canada called for "all parties" to de-escalate rising tensions in the Mideast following an apparent Israeli drone attack against Iran overnight.
A Manitoba woman thought she found a miracle natural supplement, but said a hidden ingredient wreaked havoc on her health.
Hospital chaplain J.S. Park opens up about death, grief and hearing thousands of last words, and shares his advice for the living.
A woman who recently moved to Canada from India was searching for a job when she got caught in an online job scam and lost $15,000.
More money will land in the pockets of some Canadian families on Friday for the latest Canada Child Benefit installment.
The World Health Organization and around 500 experts have agreed for the first time on what it means for a disease to spread through the air, in a bid to avoid the confusion early in the COVID-19 pandemic that some scientists have said cost lives.
On Friday, the pop star released her 11th album and at 2 a.m. Eastern, she released "The Tortured Poets Department: The Anthology," featuring 15 additional songs.
American millionaire Jonathan Lehrer, one of two men charged in the killings of a Canadian couple in Dominica, has been denied bail.
Group of Seven foreign ministers warned of new sanctions against Iran on Friday for its drone and missile attack on Israel, and urged both sides to avoid an escalation of the conflict.
At 6'8" and 350 pounds, there is nothing typical about UBC offensive lineman Giovanni Manu, who was born in Tonga and went to high school in Pitt Meadows.
Kevin the cat has been reunited with his family after enduring a harrowing three-day ordeal while lost at Toronto Pearson International Airport earlier this week.
Molly Knight, a grade four student in Nova Scotia, noticed her school library did not have many books on female athletes, so she started her own book drive in hopes of changing that.
Almost 7,000 bars of pure gold were stolen from Pearson International Airport exactly one year ago during an elaborate heist, but so far only a tiny fraction of that stolen loot has been found.
When Les Robertson was walking home from the gym in North Vancouver's Lower Lonsdale neighbourhood three weeks ago, he did a double take. Standing near a burrow it had dug in a vacant lot near East 1st Street and St. Georges Avenue was a yellow-bellied marmot.
A moulting seal who was relocated after drawing daily crowds of onlookers in Greater Victoria has made a surprise return, after what officials described as an 'astonishing' six-day journey.
Just steps from Parliament Hill is a barber shop that for the last 100 years has catered to everyone from prime ministers to tourists.
A high score on a Foo Fighters pinball machine has Edmonton player Dave Formenti on a high.
A compound used to treat sour gas that's been linked to fertility issues in cattle has been found throughout groundwater in the Prairies, according to a new study.