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It’s a shortened trading week with Easter next weekend, but there are a few major catalysts ahead. Read all about it my weekly setup in the Globe and Mail!
Here are five things to know today:
Are we there yet? Stocks are in the green even as oil prices continue to advance because of intensified fighting in the Middle East. Additional US troops have arrived in the region and the question of a ground invasion is still looming. US Secretary of State Marco Rubio said the war should only last another few weeks and doesn’t require ground invasion. There are no clear signs about how that will happen. Indeed, fighting has only accelerated. US President Donald Trump has threatened to “take the oil” from Iran. But the game today is about calling the bottom. Morgan Stanley’s Michael Wilson says we are “getting closer” to the end of the market sell-off. Indeed Barron’s this weekend was full of ideas: UPS, Dollar General, and Berkshire Hathaway were among the names positively touted. Tech stocks haven’t been spared and pencils are being sharpened. “The entire premium that tech stocks have built up has been erased, and that to me, doesn’t make sense,” Fundstrat Head of Research Tom Lee said in a note to clients. Below is a look at how the premium tech stocks enjoyed relative to the S&P 500 has been completely wiped out, “All this consistent earnings growth, increasing share of the economy, AI — all that’s been erased. I think that’s why the risk reward for tech is so good.”
A little further out the door: Constellation Software announced Friday night that Mark Leonard will not stand for re-election on the board. Leonard, who founded the software giant in 1995, stepped away as CEO last fall for health reasons. The stock has fallen 43% since then. The release says he will remain an advisor, particularly on the new Permanent Engagement Minority Shareholder strategy (PEMS) which involves taking stakes in publicly traded software companies vs their traditional modus operandi of buying private software businesses. Shares have been under pressure on anxieties that AI will disrupt their software businesses which will have to contend with lower margins and lower terminal values.
Se retirer: Air Canada announced CEO Michael Rousseau will be retiring amid a firestorm over his French language speaking abilities. He sparked a political furor over delivering an English-only message following a deadly crash that killed two Air Canada pilots. After 5 years in the role, Rousseau informed the board he will be stepping down at the end of the third quarter. He is 68 years old. The board addressed the PR blowback around Rousseau’s message, which drew the ire of Prime Minister Mark Carney, by saying their search for a new CEO will include criteria like “the ability to communicate in French.”
Crinkle: Aluminum stocks are popping after attacks on aluminum makers in the Middle East threaten to disrupt global supply. Shares of Alcoa are surging 10% in the pre-market after two Middle East aluminum makers. This shows that disruptions from war extend beyond just the energy markets. Others miners with aluminum exposure include Rio Tinto, Norsk Hydrio and Glencore.
Pump: Peloton shares are pumping higher (+3%) after Eric Jackson of EMJ Capital touted it as a top idea. Jackson has commanded a retail army of investors and has made appearances on our show to talk about ideas like OpenDoor and Better Home and Finance. “The market is seeing declining revenue, the old covid story, broken hardware story,” said Jackson in a video post, “Here is what they are missing: seven insiders just bought stock including the CEO and CFO, and now ex CFO. Companies that are going to zero, you don’t see that.” It’s a name he has dabbled in on and off for years although the stock has continued to slide. This appears to be new conviction.
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