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Daily Pulse


Ontario will implement further COVID-19 restrictions soon, with a focus on areas being hardest hit as a deadlier strain of coronavirus surges through Canada’s most populous province. The new measures will aim to curb the spread of the virus in Toronto and suburban regions of Peel and York, which represent about 60 per cent of new infections, Ontario Premier Doug Ford said Tuesday at a news conference. Details will be disclosed on Wednesday, he said. “We made a massive move last week by basically shutting down the entire province,” Ford said. “We’re going to have further restrictions moving forward very quickly.” Ontario’s cabinet is meeting this afternoon to discuss options, including the possibility of a new stay-at-home order, CTV News reported, citing sources. Efforts to quell the most recent surge will target large employers and residents in virus hot spots, Ford said Tuesday. Last month, Peel region ordered Amazon.com Inc. to close a warehouse for two weeks because the infection rate was increasing significantly.


The night before the Archegos Capital story burst into public view late last month, the fund’s biggest prime broker quietly unloaded some of its risky positions to hedge funds, people with knowledge of the trades told CNBC. This link will open in a new tab. Morgan Stanley sold about $5 billion in shares from Archegos’ doomed bets on U.S. media and Chinese tech names to a small group of hedge funds late Thursday, March 25, according to the people, who requested anonymity to speak frankly about the transaction. It’s a previously unreported detail that shows the extraordinary steps some banks took to protect themselves from incurring losses from a client’s meltdown. The moves benefited Morgan Stanley, the world’s biggest equities trading shop, and its shareholders. While the bank escaped from the episode without material losses, other firms were less fortunate. This link will open in a new tab. Credit Suisse said Tuesday that it took a This link will open in a new tab. $4.7 billion hit after unwinding losing Archegos positions; the firm also cut its dividend and halted share buybacks.

This link will open in a new tab. Amazon CEO Jeff Bezos on Tuesday voiced support for raising the corporate tax rate but stopped short of saying he supports President Joe Biden’s plan for the increase. “We support the Biden Administration’s focus on making bold investments in American infrastructure,” Bezos said in a statement. “We recognize this investment will require concessions from all sides – both on the specifics of what’s included as well as how it gets paid for (we’re supportive of a rise in the corporate tax rate).” Bezos’ support for a tax increase is notable given that Amazon has previously faced scrutiny over its tax record, including from Biden. Last May, Biden, then a presidential candidate, This link will open in a new tab. told CNBC that Amazon “should start paying their taxes.”


Markets are also digesting the IMF’s decision to raise its 2021 growth outlook for the global economy to 6%, This link will open in a new tab. up from January’s forecast of 5.5%. It said that “a way out of this health and economic crisis is increasingly visible.” However, it warned of “daunting challenges” given the varied pace of vaccine rollouts around the world. On the data front, IHS Markit’s final euro zone composite purchasing manager’s index (PMI) on Wednesday showed business activity in the bloc bouncing back in March despite a reintroduction of restrictions in several countries. The composite PMI, which combines manufacturing and services and is seen as a useful gauge of economic health, came in at 53.2, up from 48.8 in February and above the 52.5 flash estimate.


A second wave of Covid-19 infections is expected to slow India’s economic recovery in the three months between April to June, according to Goldman Sachs. The investment bank on Tuesday lowered India’s growth forecast for the quarter from 33.4% year-on-year previously, to 31.3%. It cited lower consumption and services activity likely due to increased social restrictions that are being put in place by India’s state and federal governments to tackle the new outbreak. Goldman said it expects gross domestic product (GDP) to contract sequentially by 12.2% quarter-on-quarter on an annualized basis for the three months ending June – which marks the first quarter of India’s fiscal year that began on April 1 and ends on March 31, 2022. Last year, This link will open in a new tab. India slipped into a technical recession after registering two consecutive quarters of contraction. Goldman expects activity to rebound sharply from subsequent quarters – July-September and beyond – as India’s containment policy normalizes and the vaccination pace speeds up. Still, the hit from the April-June quarter is likely to affect India’s overall growth projection for the fiscal year, which Goldman now expects at 11.7%, down from an earlier forecast of 12.3%.

Toshiba is considering a $20 billion offer from private-equity firm CVC Capital Partners to take it private, a person familiar with the matter said, as the Japanese industrial conglomerate faces pressure from activist shareholders to improve governance. The proposed deal, which comes three weeks after shareholders approved an independent probe into the scandal-hit company, could shield management, particularly Chief Executive Nobuaki Kurumatani, from that scrutiny. It would, however, invite regulatory review given its government work. “Toshiba received an initial proposal yesterday, and will ask for further clarification and give it careful consideration,” Toshiba said in a statement, without providing further details. Toshiba’s board, which includes Kurumatani who joined Toshiba from CVC, and Yoshiaki Fujimori, a senior adviser at the private equity firm, discussed the proposal on Wednesday, the source with knowledge of the proposal said. Shares in Toshiba soared 18% to their daily limit on Wednesday.

The author

Michel Doucet

Michel Doucet

Vice-President and Portfolio Manager
After obtaining a Bachelor's degree from the Faculty of Social Sciences at the Université du Québec in Montréal and his Master’s degree, Michel Doucet began his career as a junior economist at the National Bank head office in Montreal. In 1992 he joined the institutional equities and fixed income group at Lévesque Beaubien Geoffrion as an economist and market analyst. Over the years, he has led various projects related to the North American and international economies as well as Canadian public finances. In 1996, the team of institutional economists to which he belongs was ranked first in Canada by Brendan Wood International. In August 1997, Mr. Doucet joined the personal services division of Lévesque Beaubien Geoffrion where he served as an economist, fixed income market analyst and vice president. In 2004, he joined the Desjardins Securities full service team as Vice President. He now occupies the roles of fixed income strategist, economist and portfolio manager. He manages the Securities Portfolio Advisory Group, advisor marketing and distribution of financial planning and insurance.