Everything You Need to Know on Wednesday: Bank of Canada Poised for Another Rate Cut to Secure Soft Landing

Good morning mooers! Here are things you need to know about today's market:

● S&P/TSX 60 Index Standard Futures are trading at 1,362.50, down 0.20% from previous close

● Bank of Canada poised for another rate cut to secure soft landing

● CN Rail cuts 2024 earnings outlook amid strike fears

● Rogers Communications quarterly profit jumps

● Tilray Medical granted approval to introduce third medical cannabis product in Portugal

Today, the Canadian dollar is trading at 72.68 cents US, a slight decrease from previous close.

S&P/TSX 60 Index Standard Futures are trading at 1,362.50, down 0.20% from previous close.

The Bank of Canada is expected to make another interest rate cut to avoid a recession and keep inflation in check. Governor Tiff Macklem, who previously reduced rates, foresees a soft landing and is anticipated to announce a cut from 4.75% to 4.5%.

Despite the delicate balance between curbing inflation and stimulating the economy, Macklem is set to reassure Canadians of the bank's direction. Even with some persistent inflationary pressures and economic concerns, such as mortgage renewals and temporary migration policy impacts, the bank is focused on a gradual rate reduction.

Economists predict a steady decline in inflation, aligning with the bank's target by 2025, and expect a cautious approach from the bank with no explicit forward guidance.

Consecutive rate cuts raise questions about the pace of normalizing borrowing costs, balancing the benefits for upcoming mortgage renewals against the risk of re-igniting inflation or the tight housing market.

Labor market conditions are softening, which may alleviate some inflationary wage pressures. The Bank of Canada's surveys show inflation expectations are contained, suggesting a possible further easing is on the horizon.

Adjusted earnings reached $1.17 billion, or $1.84 per share, up from $1.76 per share in the previous year. Revenues rose to $4.33 billion, marking a seven percent increase.

However, CN Rail revised its yearly adjusted earnings per share growth down to mid to high single digits, a step back from its initial 10 percent growth estimate. The downgrade is linked to the potential for worker strikes after the Teamsters Canada Rail Conference rejected CN's proposal for binding arbitration.

Adjusted earnings per share were CAD 1.16, slightly below analyst expectations of CAD 1.17. Revenue saw a marginal increase of 0.9% to CAD 5.09 billion, falling short of the anticipated CAD 5.14 billion.

Wireless revenue grew 1.7% to CAD 2.47 billion, driven by more subscribers. Conversely, cable revenue dropped 2.4% to CAD 1.96 billion due to fewer home-phone and satellite customers, despite promotions. Media revenue, which includes sports and broadcasting, jumped 7.3% to CAD 736 million, boosted by sports revenue and the performance of the Toronto Blue Jays.

Rogers reported a combined rise of 188,000 customers in mobile and internet for the quarter, totaling 275,000 for the first half of the year.

The company has maintained its 2024 forecast, projecting service revenue growth of 8% to 10% from last year's CAD 16.85 billion, with adjusted EBITDA expected to increase by 12% to 15% from CAD 8.58 billion in 2023.

The company declares 50 cents per share quarterly dividend.

Denise Faltischek, Chief Strategy Officer and Head of International at Tilray Brands, emphasized the importance of this development, stating it advances the company's commitment to addressing the vital needs of patients and supplying superior cannabis products and treatments for specific health conditions.