CANADA: Globe & Mail-PM Carney Expected To Call Snap Election For 28 April
Globe and Mail reporting that according to its sources, new PM Mark Carney is set to call a snap general election to take place on Monday 28 April. The calling of a snap election has been seen as an inevitability due to a number of factors.
- A procedural reason is that parliament returns from prorogation on 24 March. As this will be a new session, it requires a Speech from the Throne, followed by a confidence vote in the gov't.
- The LPC sits as a minority gov't, and crucially the two opposition parties that previously had backed the Liberals in confidence votes, the left-wing New Democratic Party (NDP) and the regionalist Bloc Quebecois (BQ) have withdrawn their support. This would have seen the gov't fall and a snap election called anyway. It comes as less of a blow for the PM to call the election himself.
- The tactical reason for a snap election is that the Canadian political landscape has been upended in recent weeks, not so much by the change in leadership at the top of gov't, but by the impact of US President Donald Trump's campaign of tariffs on Canadian exports and aggressive rhetoric regarding the country becoming part of the United States.
- Support for Carney's centre-left Liberal Party of Canada (LPC), which sat ~20% behind the main opposition centre-right Conservative Party of Canada (CPC) as recently as early January, has skyrocketed to the point where betting markets now view the LPC as favourites to win the most seats (see chart below).
- Finally, there is the day-to-day business reason behind a snap election, in that Carney does not currently hold a seat in the Commons, barring him from speaking to the chamber. It is unclear where Carney might seek to stand. Growing up in Edmonton, Alberta, Carney could seek to become the first ever LPC leader to represent a riding from western Canada.
Chart 1. Betting Market Implied Probability of Party Winning Most Seats, %
Source: Polymarket
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COMMODITIES: Gold Holding Onto Bulk of Recent Gains, Bull Cycle Intact
WTI futures have pulled back from last week’s high and price has again traded below the 50-day EMA - at $71.62. Attention is on $70.20 (pierced), the Feb 6 low. A clear break of it would undermine a bullish theme and confirm a breach of the 50-day EMA. This would strengthen a bearish threat and open $67.75, the Dec 20 ‘24 low. Key S/T resistance has been defined at $74.06, the Feb 3 high. A move above this level would reinstate a bull theme. A bull cycle in Gold remains in play and the yellow metal continues to hold on to the bulk of its recent gains. Fresh highs once again confirm a resumption of the uptrend and maintain the bullish price sequence of higher highs and higher lows. Moving average studies are in a bull mode position too, highlighting a dominant uptrend. Sights are on the $2962.2, a Fibonacci projection. The first key support to watch is $2833.2, the 20-day EMA.
- WTI Crude up $1.13 or +1.6% at $71.89
- Natural Gas down $0.15 or -3.89% at $3.581
- Gold spot up $15.61 or +0.54% at $2912.21
- Copper down $6.75 or -1.43% at $464.55
- Silver up $0.16 or +0.49% at $32.4995
- Platinum up $2.86 or +0.29% at $987.92
EQUITIES: Bullish Trend Structure in Eurostoxx 50 Futures Remains in Play
The trend condition in Eurostoxx 50 futures remains bullish. The move higher last week confirmed once again, a resumption of the uptrend that started on Nov 21 ‘24. Moving average studies are in a bull mode set-up too, highlighting a dominant uptrend. A major resistance at 5525.00, the March 2000 all-time high (cont), has been pierced. A clear break of it would highlight a key bullish technical breach. Support to watch is 5325.83, the 20-day EMA. S&P E-Minis continue to climb and the contract maintains a firmer tone. Attention is on resistance at 6162.25, the Jan 24 high. Clearance of this level would expose the key resistance at 6178.75, the Dec 6 ‘24 high. A move above this hurdle would resume the primary uptrend.On the downside, initial key support has been defined at 6014.00, the Feb 10 low. A break would highlight a bearish development.
- Japan's NIKKEI closed higher by 96.15 pts or +0.25% at 39270.4 and the TOPIX ended 8.61 pts higher or +0.31% at 2775.51.
- Elsewhere, in China the SHANGHAI closed lower by 31.34 pts or -0.93% at 3324.49 and the HANG SENG ended 360.58 pts higher or +1.59% at 22976.81.
- Across Europe, Germany's DAX trades lower by 72.66 pts or -0.32% at 22726.07, FTSE 100 lower by 8.26 pts or -0.09% at 8759.9, CAC 40 down 24.22 pts or -0.3% at 8164.53 and Euro Stoxx 50 down 11.34 pts or -0.21% at 5508.37.
- Dow Jones mini up 21 pts or +0.05% at 44656, S&P 500 mini up 16.75 pts or +0.27% at 6148.75, NASDAQ mini up 83 pts or +0.37% at 22279.5.
EQUITIES: Estoxx Put Spread seller
SX5E (18/12/26) 5500/5000ps, sold at 175.2 in 10k.
