Say what you like about the Occupy Wall Street crowd, there can be no doubt about their realism and effectiveness:
About 1,000 people gathered in the heart of Toronto’s financial district beginning at 10 a.m. local time to protest inequality and advocate higher taxes for the wealthy. About an hour later, organizers began moving the demonstration to nearby St. James Park.
“To see people take action like this is amazing,” said Neal Hamell, a student from London, Ontario, who traveled to Toronto today to join the protests. “I’d like to see change. If this doesn’t do anything, then something is wrong with the world.”
I understand that on Wednesday they’re going to bring peace to the Middle East, but have not yet decided what to do in the afternoon.
Sparks are flying over the Tobin Tax:
German Chancellor Angela Merkel criticized governments including President Barack Obama’s administration for refusing to make the financial sector pay for the global financial crisis, and vowed to push for a financial transaction tax until it applies at least in Europe.
“It’s not acceptable that especially those outside the euro region, who are time and again pushing us to take broad- based action to manage the debt crisis, are at the same time flatly refusing to impose a financial transactions tax,” Merkel said at a labor union congress in the city of Karlsruhe yesterday. “I think this is not okay. We want, and we have to make, financial market participants contribute to the costs of crisis management.”
SLF is forecasting a big loss for 11Q3:
Sun Life Financial Inc. (TSX: SLF) (NYSE: SLF) announced preliminary estimates for the third quarter of 2011. The Company expects to report a loss of $621 million for the quarter. On an operating basis, the loss is expected to be $572 million. Results for the third quarter include losses related to substantial declines in both equity markets and interest rate levels, which particularly impacted the individual life and variable annuity businesses in SLF U.S. The third quarter was a period of exceptional market volatility. North American equity markets dropped by 12% – 14%, while yields on fixed income securities fell amid economic uncertainty in the European Union and U.S. monetary policy actions aimed at lowering interest rates on long-term treasuries. In the U.S., treasury rates reached historic lows, with 30-year yields down 146 basis points to 2.91%. Under the Canadian insurance accounting model, the future impact of September 30, 2011, market conditions is reflected in our current period results.
Losses from equity market and interest rate movements were at the high end of the ranges previously disclosed in the Company’s Management’s Discussion and Analysis for the second quarter of 2011. Key drivers which resulted in market impacts at the high end of the estimated ranges included uneven movements across the yield curve and the impact of large, simultaneous movements in both interest rates and equity markets. Updates to the Company’s actuarial methods and assumptions, which generally take place in the third quarter of each year, contributed approximately $200 million to the loss. Sun Life Assurance Company of Canada remains well capitalized, with a Minimum Continuing Capital and Surplus Requirements (MCCSR) ratio that is estimated to be approximately 210% as at September 30, 2011.
The Company currently expenses hedging costs for variable annuities and segregated funds in the period in which they are incurred. In the fourth quarter of 2011, the Company plans to make a method and assumption change related to the valuation of its variable annuity and segregated fund liabilities whereby it will provide for the estimated future lifetime hedging costs of these contracts in its liabilities. This change is expected to result in a higher level of future earnings from in-force contracts than would be the case using the current methodology. The impact of this change on the net income of the Company in the fourth quarter will depend on interest rates and other market conditions as at December 31, 2011, as well as further refinements to the valuation methodology. If this change was made under current market conditions the expected one-time reduction in fourth quarter net income is estimated to be approximately $500 million. The impact of this change on the MCCSR ratio of Sun Life Assurance is expected to be positive, as the increase in variable annuity and segregated fund liabilities will reduce the amount of regulatory required capital for these products.
How ’bout those Germans, eh? Refusing to write Europe a blank cheque!
.Germany said European Union leaders won’t provide the complete fix to the euro-area debt crisis that global policy makers are pushing for at an Oct. 23 summit.
German Chancellor Angela Merkel has made it clear that “dreams that are taking hold again now that with this package everything will be solved and everything will be over on Monday won’t be able to be fulfilled,” Steffen Seibert, Merkel’s chief spokesman, said at a briefing in Berlin today. The search for an end to the crisis “surely extends well into next year.”
Group of 20 finance ministers and central bankers concluded weekend talks in Paris endorsing parts of Europe’s emerging plan to avoid a Greek default, bolster banks and curb contagion. Providing a week to act, they set the Oct. 23 meeting of European leaders in Brussels as the deadline.
Lapdog Carney’s getting a lot of press, shilling for his political master.
Fortis Alberta issued 30-year paper at 4.54%.
It was a mixed day in the Canadian preferred share market, with PerpetualDiscounts winning 23bp, FixedResets up 2bp and DeemedRetractibles losing 13bp. Insurers figured prominently on the wrong side of the performance table, presumably due to Sun Life’s announcement. Volume was above average.
| HIMIPref™ Preferred Indices These values reflect the December 2008 revision of the HIMIPref™ Indices Values are provisional and are finalized monthly |
|||||||
| Index | Mean Current Yield (at bid) |
Median YTW |
Median Average Trading Value |
Median Mod Dur (YTW) |
Issues | Day’s Perf. | Index Value |
| Ratchet | 0.00 % | 0.00 % | 0 | 0.00 | 0 | -0.5162 % | 1,981.0 |
| FixedFloater | 0.00 % | 0.00 % | 0 | 0.00 | 0 | -0.5162 % | 2,979.4 |
| Floater | 3.63 % | 3.64 % | 155,402 | 18.21 | 2 | -0.5162 % | 2,138.9 |
| OpRet | 4.85 % | 2.63 % | 61,218 | 1.55 | 8 | 0.0876 % | 2,449.1 |
| SplitShare | 5.45 % | 1.83 % | 53,964 | 0.36 | 4 | -0.0334 % | 2,462.0 |
| Interest-Bearing | 0.00 % | 0.00 % | 0 | 0.00 | 0 | 0.0876 % | 2,239.4 |
| Perpetual-Premium | 5.68 % | 3.79 % | 105,875 | 0.37 | 13 | -0.0802 % | 2,129.4 |
| Perpetual-Discount | 5.35 % | 5.39 % | 111,738 | 14.82 | 17 | 0.2261 % | 2,256.2 |
| FixedReset | 5.14 % | 3.29 % | 202,517 | 2.57 | 61 | 0.0213 % | 2,329.1 |
| Deemed-Retractible | 5.08 % | 4.54 % | 212,956 | 5.83 | 46 | -0.1342 % | 2,192.3 |
| Performance Highlights | |||
| Issue | Index | Change | Notes |
| GWO.PR.I | Deemed-Retractible | -1.75 % | YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 21.88 Bid-YTW : 6.22 % |
| SLF.PR.D | Deemed-Retractible | -1.67 % | YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 21.24 Bid-YTW : 6.55 % |
| SLF.PR.E | Deemed-Retractible | -1.42 % | YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 21.54 Bid-YTW : 6.42 % |
| SLF.PR.A | Deemed-Retractible | -1.32 % | YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 22.50 Bid-YTW : 6.14 % |
| SLF.PR.C | Deemed-Retractible | -1.29 % | YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 21.36 Bid-YTW : 6.47 % |
| SLF.PR.F | FixedReset | -1.20 % | YTW SCENARIO Maturity Type : Call Maturity Date : 2014-06-30 Maturity Price : 25.00 Evaluated at bid price : 26.25 Bid-YTW : 4.17 % |
| SLF.PR.B | Deemed-Retractible | -1.18 % | YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 22.54 Bid-YTW : 6.17 % |
| HSB.PR.D | Deemed-Retractible | -1.01 % | YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 24.60 Bid-YTW : 5.27 % |
| BAM.PR.T | FixedReset | 1.05 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2041-10-17 Maturity Price : 23.13 Evaluated at bid price : 24.98 Bid-YTW : 3.98 % |
| POW.PR.B | Perpetual-Discount | 1.22 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2041-10-17 Maturity Price : 24.64 Evaluated at bid price : 24.90 Bid-YTW : 5.39 % |
| GWO.PR.H | Deemed-Retractible | 1.28 % | YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 23.66 Bid-YTW : 5.61 % |
| POW.PR.D | Perpetual-Discount | 1.46 % | YTW SCENARIO Maturity Type : Limit Maturity Maturity Date : 2041-10-17 Maturity Price : 24.10 Evaluated at bid price : 24.40 Bid-YTW : 5.14 % |
| CIU.PR.B | FixedReset | 1.90 % | YTW SCENARIO Maturity Type : Call Maturity Date : 2014-06-01 Maturity Price : 25.00 Evaluated at bid price : 27.36 Bid-YTW : 3.29 % |
| Volume Highlights | |||
| Issue | Index | Shares Traded |
Notes |
| BMO.PR.J | Deemed-Retractible | 110,596 | RBC crossed blocks of 50,500 and 50,000, both at 25.15. YTW SCENARIO Maturity Type : Call Maturity Date : 2016-02-25 Maturity Price : 25.00 Evaluated at bid price : 25.20 Bid-YTW : 4.48 % |
| SLF.PR.C | Deemed-Retractible | 57,689 | YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 21.36 Bid-YTW : 6.47 % |
| POW.PR.C | Perpetual-Premium | 57,400 | Nesbitt crossed 40,000 at 25.09. YTW SCENARIO Maturity Type : Call Maturity Date : 2011-12-06 Maturity Price : 25.00 Evaluated at bid price : 25.05 Bid-YTW : 4.60 % |
| TD.PR.M | OpRet | 50,300 | Called for redemption. YTW SCENARIO Maturity Type : Call Maturity Date : 2012-04-30 Maturity Price : 25.25 Evaluated at bid price : 25.47 Bid-YTW : 2.65 % |
| GWO.PR.J | FixedReset | 42,931 | Nesbitt crossed 40,000 at 26.40. YTW SCENARIO Maturity Type : Call Maturity Date : 2013-12-31 Maturity Price : 25.00 Evaluated at bid price : 26.30 Bid-YTW : 3.68 % |
| SLF.PR.H | FixedReset | 39,855 | Nesbitt crossed 25,000 at 24.80. YTW SCENARIO Maturity Type : Hard Maturity Maturity Date : 2022-01-31 Maturity Price : 25.00 Evaluated at bid price : 24.76 Bid-YTW : 4.05 % |
| There were 37 other index-included issues trading in excess of 10,000 shares. | |||
| Wide Spread Highlights | ||
| Issue | Index | Quote Data and Yield Notes |
| BAM.PR.J | OpRet | Quote: 26.17 – 27.10 Spot Rate : 0.9300 Average : 0.6611 YTW SCENARIO |
| GWO.PR.I | Deemed-Retractible | Quote: 21.88 – 22.45 Spot Rate : 0.5700 Average : 0.3876 YTW SCENARIO |
| BNA.PR.C | SplitShare | Quote: 21.12 – 21.59 Spot Rate : 0.4700 Average : 0.3310 YTW SCENARIO |
| ELF.PR.F | Perpetual-Discount | Quote: 22.00 – 22.49 Spot Rate : 0.4900 Average : 0.3982 YTW SCENARIO |
| IAG.PR.A | Deemed-Retractible | Quote: 21.80 – 22.39 Spot Rate : 0.5900 Average : 0.4997 YTW SCENARIO |
| W.PR.J | Perpetual-Discount | Quote: 24.90 – 25.17 Spot Rate : 0.2700 Average : 0.1875 YTW SCENARIO |
Just noticed today that Yellow Media insiders made a ‘sizable’ purchase (63,000) of common (at the .19 level of course). Not big $, but one wonders what they see ahead.
[…] This announcement follows SLF’s announcement of big charges in a press release that I discussed on October 17. […]
Did you see this on the TMX daily report? I don’t see anything on SEDI