Market Action

October 11, 2017

The salutary effects of Ontario’s minimum wage hike are becoming visible: one large company is thinking about what it’s doing and taking steps to increase productivity:

Grocery store chain Metro Inc. says it will eliminate about 280 jobs starting in 2021 as part of a $400-million overhaul of its Ontario distribution network.

The company says the move to modernize and automate its network will mean the loss of about 180 full-time and 100 part-time positions.

The announcement follows comments by Metro in August that it would study automation as it looked to cut costs in the face of the Ontario government’s plan to raise the minimum wage next year.

PerpetualDiscounts now yield 5.32%, equivalent to 6.92% interest at the standard equivalency factor of 1.3x. Long corporates now yield about 4.05%, so the pre-tax interest-equivalent spread (in this context, the “Seniority Spread”) is now about 285bp, a significant narrowing from the 295bp reported October 4.

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 -0.2358 % 2,415.9
FixedFloater 0.00 % 0.00 % 0 0.00 0 -0.2358 % 4,433.1
Floater 3.78 % 3.94 % 28,764 17.58 4 -0.2358 % 2,554.8
OpRet 0.00 % 0.00 % 0 0.00 0 0.0066 % 3,074.6
SplitShare 4.74 % 4.66 % 75,736 4.39 6 0.0066 % 3,671.7
Interest-Bearing 0.00 % 0.00 % 0 0.00 0 0.0066 % 2,864.8
Perpetual-Premium 5.36 % 2.99 % 64,477 0.22 17 0.0417 % 2,816.4
Perpetual-Discount 5.36 % 5.32 % 62,163 14.91 19 0.0113 % 2,940.8
FixedReset 4.26 % 4.31 % 150,972 4.59 99 0.1883 % 2,469.8
Deemed-Retractible 5.08 % 5.58 % 101,012 6.02 30 0.1635 % 2,896.2
FloatingReset 2.77 % 2.73 % 50,891 4.06 8 0.1197 % 2,676.6
Performance Highlights
Issue Index Change Notes
ELF.PR.G Perpetual-Discount -1.79 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-10-11
Maturity Price : 21.75
Evaluated at bid price : 22.00
Bid-YTW : 5.41 %
BAM.PR.R FixedReset -1.02 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-10-11
Maturity Price : 20.41
Evaluated at bid price : 20.41
Bid-YTW : 4.75 %
HSE.PR.E FixedReset 1.02 % YTW SCENARIO
Maturity Type : Call
Maturity Date : 2020-03-31
Maturity Price : 25.00
Evaluated at bid price : 24.68
Bid-YTW : 5.15 %
SLF.PR.C Deemed-Retractible 1.03 % YTW SCENARIO
Maturity Type : Hard Maturity
Maturity Date : 2025-01-31
Maturity Price : 25.00
Evaluated at bid price : 21.52
Bid-YTW : 6.98 %
BAM.PR.Z FixedReset 1.18 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-10-11
Maturity Price : 24.05
Evaluated at bid price : 24.87
Bid-YTW : 4.73 %
HSE.PR.A FixedReset 1.18 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-10-11
Maturity Price : 17.11
Evaluated at bid price : 17.11
Bid-YTW : 4.82 %
BMO.PR.Q FixedReset 1.36 % YTW SCENARIO
Maturity Type : Hard Maturity
Maturity Date : 2022-01-31
Maturity Price : 25.00
Evaluated at bid price : 22.35
Bid-YTW : 4.74 %
TRP.PR.F FloatingReset 1.46 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-10-11
Maturity Price : 20.09
Evaluated at bid price : 20.09
Bid-YTW : 3.55 %
MFC.PR.K FixedReset 1.53 % YTW SCENARIO
Maturity Type : Hard Maturity
Maturity Date : 2025-01-31
Maturity Price : 25.00
Evaluated at bid price : 22.50
Bid-YTW : 5.72 %
TRP.PR.B FixedReset 2.90 % YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-10-11
Maturity Price : 16.30
Evaluated at bid price : 16.30
Bid-YTW : 4.50 %
Volume Highlights
Issue Index Shares
Traded
Notes
TRP.PR.J FixedReset 242,000 YTW SCENARIO
Maturity Type : Call
Maturity Date : 2021-05-31
Maturity Price : 25.00
Evaluated at bid price : 26.70
Bid-YTW : 3.69 %
TRP.PR.K FixedReset 196,554 YTW SCENARIO
Maturity Type : Call
Maturity Date : 2022-05-31
Maturity Price : 25.00
Evaluated at bid price : 26.01
Bid-YTW : 4.09 %
RY.PR.R FixedReset 150,859 YTW SCENARIO
Maturity Type : Call
Maturity Date : 2021-08-24
Maturity Price : 25.00
Evaluated at bid price : 26.99
Bid-YTW : 3.51 %
NA.PR.A FixedReset 110,695 YTW SCENARIO
Maturity Type : Call
Maturity Date : 2021-08-15
Maturity Price : 25.00
Evaluated at bid price : 26.13
Bid-YTW : 4.01 %
NA.PR.S FixedReset 108,828 YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-10-11
Maturity Price : 23.16
Evaluated at bid price : 23.57
Bid-YTW : 4.38 %
TD.PF.E FixedReset 106,096 YTW SCENARIO
Maturity Type : Call
Maturity Date : 2020-10-31
Maturity Price : 25.00
Evaluated at bid price : 24.90
Bid-YTW : 3.78 %
There were 29 other index-included issues trading in excess of 10,000 shares.
Wide Spread Highlights
Issue Index Quote Data and Yield Notes
POW.PR.B Perpetual-Discount Quote: 24.85 – 26.66
Spot Rate : 1.8100
Average : 1.0178

YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-10-11
Maturity Price : 24.60
Evaluated at bid price : 24.85
Bid-YTW : 5.40 %

BMO.PR.Q FixedReset Quote: 22.35 – 22.74
Spot Rate : 0.3900
Average : 0.2523

YTW SCENARIO
Maturity Type : Hard Maturity
Maturity Date : 2022-01-31
Maturity Price : 25.00
Evaluated at bid price : 22.35
Bid-YTW : 4.74 %

ELF.PR.G Perpetual-Discount Quote: 22.00 – 22.38
Spot Rate : 0.3800
Average : 0.2433

YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-10-11
Maturity Price : 21.75
Evaluated at bid price : 22.00
Bid-YTW : 5.41 %

GWO.PR.N FixedReset Quote: 17.35 – 17.75
Spot Rate : 0.4000
Average : 0.2826

YTW SCENARIO
Maturity Type : Hard Maturity
Maturity Date : 2025-01-31
Maturity Price : 25.00
Evaluated at bid price : 17.35
Bid-YTW : 8.31 %

BMO.PR.S FixedReset Quote: 23.80 – 24.08
Spot Rate : 0.2800
Average : 0.1685

YTW SCENARIO
Maturity Type : Limit Maturity
Maturity Date : 2047-10-11
Maturity Price : 23.40
Evaluated at bid price : 23.80
Bid-YTW : 4.32 %

MFC.PR.L FixedReset Quote: 22.11 – 22.36
Spot Rate : 0.2500
Average : 0.1745

YTW SCENARIO
Maturity Type : Hard Maturity
Maturity Date : 2025-01-31
Maturity Price : 25.00
Evaluated at bid price : 22.11
Bid-YTW : 5.96 %

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