Canadian equities
- Canadian equities, as measured by the S&P/TSX Composite Index, are trading lower as investors digest today’s recent earnings releases.
- Eight of the index’s eleven sectors are in the red, with Communication Services being the biggest loser.
In corporate news
- The Toronto Dominion Bank (TD):TD reported its FQ2/24, beating consensus estimates on the revenue and EPS lines. TD did not provide new information as it pertains to its AML issues other than clarifying that those issues are in the US. The growth in revenue was attributed to strong performance in its capital markets division. TD’s capital markets division reported its adjusted net income more than doubled to CA$441 million. CFO Kelvin Tran noted its capital markets division had strong contributions from trading, investment baking, and advisory underwriting. TD also announced it incurred a charge of CA$103 million for a special assessment by the US FDIC related to bank failures plus CA$165 million for severance payments and other ongoing cost cutting.
U.S. equities
- U.S. equities, as measured by the S&P 500 Index, are trading higher through midday as investors assess the final stretch of earnings releases and await economic data releases.
- Nine of the index’s eleven sectors are in the red, with Technology being the biggest winner.
In corporate news
Nvidia Corporation (NVDA): NVDA reported Q1F25 results and provided Q2F25 guidance that exceeded consensus expectations. Revenue guidance for next quarter implies 7.5% sequential growth and 107% YoY growth and beat Street expectations by 5%. The strong performance reflects robust and accelerating demand for generative AI training and inference on NVDA’s Hopper platform. Its data center division generated $22.6 billion in revenue for the quarter (versus consensus estimates of $21.1 billion). Management noted H200 and Blackwell demand is well ahead of supply, and it expects this dynamic to continue well into next year. NVDA also announced an increase of its quarterly dividend by $0.10 per share.
Synopsys Inc (SNPS): Yesterday SNPS reported its 2QF25 results, beating expectations on the top and bottom lines. Management raised its guidance for the full year based on continued momentum and strong execution. Operating margin came in at 37.3% (versus consensus estimates of 36.4%), while it raised guidance for its full fiscal year to 38.1%. SNPS reported revenue of $1.5 billion for 2Q (up 4.3% year-over-year), narrowly above the consensus of $1.4 billion, which was attributed to higher-than-expected sales in EDA. Elsewhere, management noted Ansys shareholders voted to approve the proposed cash-and-stock acquisition, tracking its 1H25 closing date.
International equities
- European equities, as measured by the Stoxx Europe 600 Index, closed higher today as investors assess the likelihood of eases in monetary policy stance.
- Ten of the index’s twenty sectors finished in the green today, with Technology the biggest gainer.
In corporate news
Alibaba Group Holdings Ltd (BABA): Earlier today, BABA announced it will be offering $4.5 billion in convertible senior notes for which it intends to use the proceeds to repurchase a number of its American Depositary shares. The Notes will mature in 2031 and are fully convertible for cash, ADSs, or ordinary shares. Earlier in the year, BABA announced the approval of an expansion on its share buyback program, adding $25 billion in stock repurchases (representing ~12.5% of its market capitalization). The moves comes after rival Chinese retailer, JD, completed a $1.8 billion convertible offering earlier in the week. Chairman and CEO duo Joe Tsai and Eddie Wu noted in a shareholder letter on the importance of striking a balance between returning capital to shareholders and reinvesting in new or existing businesses.
