- The overall RBC Purchasing Managers' Index (PMI) for June 2012 indicated continued strong improvement in manufacturing business conditions with an index reading of 54.8 that managed to outpace marginally the 54.7 recorded in May.
- Business conditions were supported by strong increases in both the new orders and output components.
- All four Canadian regions surveyed indicated strengthening business conditions in June with the pace of improvement picking up in two regions.
- The RBC PMI for June indicated that business conditions in manufacturing strengthened robustly once again although at a rate only slightly stronger than what prevailed in May; however, this represented the strongest improvement in manufacturing confidence since September 2011. The strength in business conditions reflected a continued strong pace of growth in both new orders and production. Indications of robust gains in business conditions are heartening and suggest that strength domestically is helping to offset financial market pressures related to the European sovereign-debt crisis.
The RBC Canadian Manufacturing Purchasing Managers' Index (PMI) for June managed to inch higher for the fifth consecutive months; however, the improvement was slight in rising to 54.8 from 54.7 in May. Any reading above 50 indicates improving conditions in the manufacturing sector with the wider the gap above this break even level indicating the greater the extent of the improvement. The increase in June implies that conditions improved by the fastest rate since September 2011.
The overall PMI index is compiled as a weighted sum of five individual components. In June, it is encouraging to note that the key new orders and output components continue to improve steadily. The former showed a solid rise to 56.4 from 55.5, thereby indicating not only rising new orders but also at a strengthening pace. This represents the fifth consecutive increase since a recent trough in January of 50.9. The output measure was similarly up strongly by rising to 55.4 in June from 54.7 in May. This measure has been similarly rising strongly since January 2012 although there was a slight interruption in March when the index dropped marginally to 51.8 from 52.0 in February. Supplier delivery times, which enter inversely into the overall PMI, were unchanged in the month at 46.2. This implied a lengthening in supplier delivery times although at no worse a rate than what prevailed in May.
The main offset to the strength in new orders and production was the stock of purchases component that sank to 50.9 from a spike in May of 53.3. The measure indicates that inventory inputs continued to rise although the pace has slowed sharply relative to the previous month. The reading in June, however, looks more in line with a steady build in input inventories since January 2012 save for the huge surge implied by the reading for May. The employment measure also provided some offset to the strength in new orders and production although the drop in the measure to 54.6 from 54.9 was modest, and the level is still indicative of a healthy pace of hiring within manufacturing. Such bodes well for the Canadian June employment report out at the end of this week.
In terms of the other components of the survey, the responses were somewhat mixed. Most encouraging was the new export orders measure that remained strong at 54.6 and up marginally from 54.5 in May. Also, an increase in the quantity of purchases measure to 54.9 in June from 54.2 in May indicated that firms increased input purchases, likely in response to further gains in production. A significant offset was the plunge in stocks of finished goods measure to 46.5 from 49.8 in May. The June reading was the lowest during the 21-month period during which the measure has been compiled. A fall in finished good inventories could imply firms are becoming cautious about future demand although it could also reflect stronger than expected demand in the current period. The steady improvement in the new orders measure would weigh in favour of the latter versus the former factor. The survey also indicated a net slowing in the backlog of work with this measure dropping to 48.8 in June from 50.7 in May.
The survey also provided some insights in terms of inflation pressures faced by firms (although these components are not used to compile the overall PMI). The input price index continues to indicate rising prices yet with the pace of growth slowing sharply and with the index dropping to 51.8 in June from 57.6 in May. The increase was reportedly restrained by lower oil prices. Output prices continue to rise but at a very modest pace with an index reading of 51.5 in June that was up marginally from the 51.3 recorded in May.
The RBC PMI is also calculated on a regional basis for
The RBC PMI for June indicates that business conditions in manufacturing strengthened robustly once again in the month although at a rate only slightly stronger than what prevailed in May. The level in June represented the strongest improvement in manufacturing confidence since September 2011. The strength in business conditions reflected a pick-up in the pace of growth in both new orders and production. The main factor tempering the overall improvement was a sharp slowing in the pace of inventory accumulation of inputs. Such a result would be representative of a restraining factor on business conditions to the extent that it reflected business anticipating a slowing in demand; however, an alternative explanation is that the drawdown reflected an unexpected increase in demand. To the extent that the latter is the more dominant explanation, there is the strong possibility that this component will support business conditions in July as input inventories are rebuilt. Indications of robust gains in business conditions are heartening because they suggest that domestic strength is helping to offset financial market pressures related to the European sovereign-debt crisis.
Paul Ferley, Assistant Chief Economist, RBC Economics
NEW YORK, N.Y. - News Corp. says its board of directors has approved plans to split its entertainment and publishing businesses into two separate companies.
News Corp. also said Friday that the target date for the split is June 28. The company holding its TV and movie properties will be 21st Century Fox. The new News Corp., a smaller entity, will be focused on newspapers and publishing. Both will be publicly traded.
WINNIPEG - Manitoba Telecom Services Inc. has agreed to sell its Allstream business telecommunications arm to an Egyptian investment group and use about half of the proceeds to reduce its pension obligations and debt.
MTS, which operates Manitoba's largest telecommunications business, says the deal values Allstream at $520 million.
LJUBLJANA, Slovenia - Slovenia's parliament on Friday adopted a cap on public spending to try to convince foreign investors that the small eurozone country will not need an international bailout.
The 78-8 vote in the assembly means Slovenia's constitution will be changed to require that the government budget be balanced — that is, it will not be allowed to spend more than it earns in taxes. The budget should be balanced by 2015, as demanded by the European Union.
WASHINGTON - China has agreed to give U.S. regulators access to audit records for Chinese companies whose shares trade on U.S. stock exchanges, a step forward in a long-running dispute.
The Public Company Accounting Oversight Board, a watchdog agency for the accounting industry, announced the agreement with China on Friday.
TORONTO - North American markets were slightly lower Friday following better-than-expected durable goods orders in April that suggested encouraging news for U.S. manufacturers.
The S&P/TSX composite index fell 11.91 points to 12,646.18.
GENEVA - Chinese Premier Li Keqiang is in Switzerland to sign a free trade pact with the Alpine nation — the first comprehensive agreement the country has reached with a major western economy.
Li met with Swiss officials Friday in Bern, where he is due to ink the deal after three years of talks.
ANKARA, Turkey - A look at legislation passed in Turkey's parliament early Friday that would ban all alcohol advertising and tighten restrictions on the sale of such beverages, and how such a law could affect tourists and liquor companies in the mainly Muslim but secular country.
Q: What happened?
The price of oil was knocked below US$94 a barrel Friday by a combination of ample supplies and lukewarm demand.
By early afternoon in Europe, benchmark oil for July delivery was down 70 cents to $93.55 a barrel in electronic trading on the New York Mercantile Exchange.
WASHINGTON - U.S. orders for long-lasting manufactured goods rebounded in April, buoyed by more demand for aircraft and stronger business investment. The gains suggest economic growth may be holding steady this spring.
Orders for durable goods, items expected to last at least three years, rose 3.3 per cent last month from March, the Commerce Department said Friday. That followed a 5.9 decline in March.
TORONTO - The Canadian dollar was down nearly half a cent Friday morning, falling 0.41 of cent to 96.73 cents US.
The loonie has been trading near 11-month lows against the U.S. dollar due to a combination of a stronger American currency and lower prices for many of the commodities that Canada produces.
BERLIN - German business confidence rebounded this month in an unexpectedly strong showing that sends a hopeful signal for more robust growth in Europe's biggest economy, a closely watched survey found Friday.
The Ifo think-tank 's confidence index rose to 105.7 points for May from 104.4 last month. The upturn followed two consecutive declines and beat economists' expectations of a very slight increase to 104.5.
MONTREAL - Foreign Affairs Minister John Baird says Qatar has abandoned an effort to move the headquarters of the International Civil Aviation Organization out of Montreal.
Baird says on Twitter that the Gulf state has withdrawn its bid.
OTTAWA - The Supreme Court of Canada has upheld a British Columbia judge who copied most of his ruling in a medical negligence case from the written submissions of the plaintiff.
In a unanimous decision, the justices overturned a B.C. Court of Appeal ruling that ordered a new trial in the case.
WINNIPEG - Manitoba Telecom Services Inc. has agreed to sell its Allstream business telecommunications arm to an Egyptian investment group and use about half of the proceeds to reduce its pension obligations and debt.
MTS, which operates Manitoba's largest telecommunications business, says the deal values Allstream at $520 million.
TORONTO - Toronto's deputy mayor says city government is still functioning despite the raging scandal engulfing Mayor Rob Ford over an alleged crack cocaine video.
At the same time, Doug Holyday says it's urgent for Ford to deal with the allegations that gained attention around the world.
MONTREAL - A huge boil-water advisory affecting 1.3 million people in Montreal, described by local officials as unprecedented in the recorded history of the city, was lifted late Thursday.
City officials ended the two-day-old advisory at 10:15 p.m., after tests concluded the water quality was fine.
MONTREAL - Canada's sixth-largest bank is hiking its dividend and buying back some of its shares, National Bank (TSX:NA) announced Friday along with a second-quarter profit that beat analyst estimates by a wide margin.
Montreal-based bank said its adjusted earnings hit a record $369 million — up six per cent from the same time last year. That equalled $2.08 per share, a seven per cent increase from $1.95 per share in the same quarter last year.
OTTAWA - Fraud was definitely a factor in the rash of misleading robocalls that bedevilled voters in six federal ridings in the 2011 election, but not enough of one to justify overturning the results, a Federal Court judge has decided.
The ruling, released late Thursday, left both sides in the dispute — the Conservative party in one corner, the voters who fielded the calls in the other — claiming victory of a sort.
EDMONTON - Alberta's Opposition Wildrose Party says it has paid a $90,000 penalty imposed by federal regulators for violating automated phone call rules.
The Canadian Radio-television and Telecommunications Commission says Wildrose broke the rules in 2011 and before, during and after the April 2012 provincial election.
OTTAWA - Prime Minister Stephen Harper acknowledged for the first time Thursday that "perhaps" he could have responded more quickly to the news that his trusted chief of staff had footed the $90,000 bill for Sen. Mike Duffy's disallowed housing expenses.
Harper conceded that he could have accepted the resignation of former right-hand man Nigel Wright earlier than he ultimately did — four days after Harper and the rest of Canada learned the stunning news about the personal cheque Wright wrote the senator.
TORONTO - The chief of staff to embattled Mayor Rob Ford was escorted by security from city hall premises Thursday amid swirling allegations the mayor had been caught on videotape smoking crack cocaine.
Mark Towhey, one of Ford's closest advisers whose background is in crisis management, refused to explain his sudden departure after more than a year in the position.
VANCOUVER - Scientists at the Vancouver Aquarium have sprung into action, as part of an effort to prevent an endangered frog population from becoming extinct in eastern British Columbia.
The Rocky Mountain population of northern leopard frogs plummeted by the millions in the 1970s, and only two populations are now known to exist near Creston, in B.C.'s West Kootenay region.
VANCOUVER - A massive landslide that ripped through a small hamlet in southeastern British Columbia last year, killing four people, was caused by a deluge of rain and a late spring snowmelt that triggered the largest slide to hit the region in at least 12,000 years, a report into the disaster concludes.
The report, released Thursday by the Regional District of Central Kootenay, also warns more than a dozen properties in Johnsons Landing are still at risk of another deadly slide, meaning some residents will never be able to return to their homes.
VANCOUVER - Passing a balanced budget, going on a trade mission to Asia, and establishing labour peace with teachers are among B.C. Premier Christy Clark's top priorities as she announced she will recall the legislature this summer.
Speaking to her newly elected caucus members as well as defeated candidates for the first time since the Liberals' come-from-behind election win last week, Clark said the party must now make good on its campaign promises.
CALI, Colombia - Prime Minister Stephen Harper says it is too soon to decide whether Canada should join the Pacific Alliance trade bloc in its mission to deepen economic integration.
After a day spent meeting with Latin American leaders and looking into their plans to form a European Union-like bloc to compete with Asia, Harper said he was not ready to make the call.
CALGARY - A senior TransCanada Corp. executive says the resistance to the approval of the proposed Keystone XL oilsands pipeline has made the company more cautious about future cross-border endeavours.
Alex Pourbaix, president of energy and oil pipelines at the Calgary-based pipeline and utility company (TSX:TRP), said the long delays getting Keystone approved in the U.S. has been an education.
TROIS-RIVIERES, Que. - A woman is recovering following a bizarre accident in which she was run over three times by her own car.
Trois-Rivieres, Que., police say the newspaper delivery woman was making her rounds this week and jumping in and out of her car frequently to drop copies of Le Nouvelliste on subscribers' doorsteps.
TORONTO - Maybe offering straight cash for a blood donation is a no-no, but research suggests that other incentives like free T-shirts and gift cards can boost donor rates without compromising the safety of the blood supply.
Writing Thursday in the journal Science, an international team of economists says countries that prohibit material rewards for blood donors may want to rethink that position, based on recent research.
Note to readers: This is a corrected story. A previous version incorrectly stated the car prize was offered by Canadian Blood Services.
CALGARY - An agency offering support to young sex abuse victims and named after a former NHL player who himself was molested as a teenager was busy even before it officially opened its doors Thursday.
The Sheldon Kennedy Child Advocacy Centre, named for the hockey player who brought to light sex crimes by one-time junior coach Graham James, began seeing children a couple of months ago and 200 kids have already visited the facility, Kennedy said.
MONTREAL - Quebec's corruption inquiry has heard its fair share of explosive allegations. The latest one is about an actual explosion.
A witness Thursday described the frightening methods used to keep an asphalt cartel in place, including the one time his car was blown up when he ran afoul of his fellow schemers.
OTTAWA - Mike Duffy is blowing off any talk of his voluntary resignation from the Senate amid an expense scandal that has reached all the way to the Prime Minister's Office.
Duffy spoke out Thursday, his first public comments since resigning last week after it was revealed he had made inappropriate expense claims and then paid them off with a $90,000 "gift" from Stephen Harper's chief of staff.
VIRGINIA WATER, England - Two-time defending champion Luke Donald and Ryder Cup teammate Ian Poulter missed the cut Friday at the BMW PGA Championship.
Donald (72) was 6 over overall after two rounds in the cold and rain at Wentworth.
PONTE DI LEGNO, Italy - Friday's 19th stage of the Giro d'Italia was cancelled due to snow along the route and Saturday's penultimate stage was altered for the same reasons, leaving Vincenzo Nibali with a much milder finish to defend his lead over.
For Friday, organizers said there were "adverse weather conditions and, in particular, snow on the stage route in its entirety."
BERN, Switzerland - Roger Federer says he won't play for Switzerland in the Davis Cup playoffs against Ecuador in September.
Federer says "it's better that I announce now" that he'll miss the Sept. 13-15 series at home following the U.S. Open.
PORTLAND, Ore. - The Portland Thorns' season couldn't be going any better. They're sitting atop the National Women's Soccer League's opening-season standings and drawing more than 11,000 fans to home games. And they've got Alex Morgan.
But just a few hours' drive north, the Seattle Reign are struggling with a roster unexpectedly missing its star power, and with no wins and four total goals so far.
ROME - Former Giro d'Italia winner Danilo Di Luca tested positive for EPO in a surprise test at his home before this year's race, organizers announced Friday.
If confirmed in a backup "B'' sample, Di Luca risks a lifetime ban since this is his third offence.
PONTE DI LEGNO, Italy - Race organizers say former Giro d'Italia winner Danilo Di Luca has tested positive for EPO.
More coming.
LOS ANGELES, Calif. - Jonathan Quick saved his best save for the final minute, sliding deftly across his crease and snagging Joe Pavelski's shot from point-blank range to the grateful gasps of the Los Angeles Kings' sellout crowd.
Quick's imposing post-season presence only appears to be growing, and the San Jose Sharks are running out of time to figure him out.
DETROIT - Jimmy Howard kept Jonathan Toews in his misery, making three saves against the struggling star to help the Detroit Red Wings beat the Chicago Blackhawks 2-0 on Thursday night in Game 4 of the second round series to put the NHL's best team during the regular season on the brink of elimination.
When Howard wasn't using his glove or pads to deny Toews, Detroit's skaters were rattling him and his teammates with a physical presence that is clearly making them uncomfortable.
SASKATOON - With disappointment etched on his face, Saskatoon Blades overage forward Josh Nicholls was unable to contain his emotions Thursday after the host team crashed out of the MasterCard Memorial Cup.
"It's a tough moment obviously there leaving the ice, especially the way that it happened," said Nicholls, his voice cracking following his final junior game, a London Knights' 6-1 blowout victory in the tournament's tiebreaker game. "Saskatoon's been a great city for myself and for my family and for my hockey career.
DENVER - The Colorado Avalanche are rounding up the old crew to restore the downtrodden franchise.
First, Joe Sakic was given more responsibility in the front office.
TORONTO - Plenty of star power and promising pitching by the Baltimore Orioles gave the Toronto Blue Jays every reason to resign themselves to a long night.
Through three innings, that is.
NEW YORK, N.Y. - Chris Kreider proudly wore the Broadway Hat in the victorious New York Rangers dressing room as he tried to describe the feeling of saving his team's season.
Kreider deftly steered in a pass from Rick Nash 7:03 into overtime, and the Rangers stayed alive in the Stanley Cup playoffs with a 4-3 victory over the Boston Bruins on Thursday night.
VANCOUVER - Former Vancouver Canucks coach Alain Vigneault appears to have some interesting opportunities as he pursues a new job.
Given his experience and success with the Canucks, Vigneault should get some consideration for the vacant Dallas Stars job. Dallas has a strong core of young, emerging talent, but missed the playoffs the past two seasons under former first-time NHL coach Glen Gulutzan.
INDIANAPOLIS - Fuzzy Zoeller says he's "paid his dues" after his infamous remarks about Tiger Woods ordering fried chicken for the Masters champions dinner, and believes similar comments made by Sergio Garcia will eventually blow over.
Garcia has apologized to Woods after saying at a recent awards dinner in London that he would serve fried chicken if the two rivals had dinner at the U.S. Open. Garcia called it a "silly remark," adding that "in no way was the comment meant in a racist manner."
Star Calgary running back Jon Cornish may get odd looks when he stands on one foot ordering lunch or spins through a doorway.
But he says he can't stop working on ways to improve his game, after setting a new CFL record last season for a Canadian with 1,457 rushing yards.
VANCOUVER - Ryan Lochte did many things after dominating at the 2012 London Olympics — except swim.
The U.S. swimming star, who won five gold medals in London, was featured in his own reality show called "What Would Ryan Lochte Do?" He also appeared on talk shows and made TV cameo appearances.
OTTAWA - Daniel Alfredsson has no doubt that he and the Ottawa Senators will bring their best game to Pittsburgh and doesn’t care if anyone thinks otherwise.
Down 3-1 to the Penguins, the Senators face the prospect of elimination when their best-of-seven Eastern Conference semifinal resume Friday night.
TORONTO - Prior to training camp this season, young midfielder Jonathan Osorio was just hoping to catch on with Toronto FC.
The 20-year-old from Toronto has gone well beyond just hanging around. Osorio earned a starting assignment in the MLS club's first pre-season game against Columbus in Orlando in February, has seen action in 10 of TFC's first 11 league games, scored twice and been singled out for praise by manager Ryan Nelsen, who has used him as an impact substitute.
SASKATOON - Saskatoon Blades defenceman Dalton Thrower has played his last game at the MasterCard Memorial Cup.
The Canadian Hockey League has suspended Thrower for the rest of the tournament for his check to the head on Portland Winterhawks forward Taylor Leier.