Launch Pad

Investors this week will focus on Fed minutes and early U.S. corporate earnings for clues on whether the U.S. stock rally can continue after recent volatility in heavyweight tech and semiconductor shares. The minutes from Kevin Warsh’s first Fed meeting will be scrutinized for how hawkish policymakers have become, especially after rate-cut expectations shifted toward possible hikes, although a weak June jobs report recently reduced those bets. Investors are also watching if strong performance in healthcare, industrials, and financials can give the rally an extra boost or whether weakness in tech will drag down the overall market. Earnings from Delta Air Lines and PepsiCo will provide early signals on consumer demand ahead of a reporting season in which S&P 500 profits are expected to rise more than 24%. With valuations elevated and higher rates posing a potential headwind, the market needs continued earnings strength to justify gains. 

Germany wins. Canada’s defence ambitions just took a big step after the Globe and Mail reported that the country has selected Germany’s TKMS as the preferred bidder to build a new fleet of 12 submarines, ending a closely watched competition with South Korea’s Hanwha. While negotiations are still required before a final contract is signed, the program is expected to cost $20 to $30 billion for the submarines alone, with lifetime operating and maintenance costs potentially reaching $50 billion. The purchase would significantly expand Canada’s undersea capabilities, allowing the Royal Canadian Navy to maintain up to three submarines on deployment at any given time. The decision also supports Ottawa’s broader push to rebuild Canada’s defence capabilities and meet NATO’s target of spending 5% of GDP on defence by 2035. Stay tuned for more details. 

CUSMA TBD. Trump’s decision to not grant a long-term renewal of CUSMA has left the North American trade pact intact but weakened, forcing Canada, U.S., and Mexico into annual reviews that could create recurring uncertainty. The agreement still protects most qualifying goods from tariffs, but the Trump administration argues it has failed to reduce U.S. trade deficits and is pushing for more American content in regional supply chains, especially in autos. Canada and Mexico want to preserve tariff-free access and investment certainty, while the U.S. is looking for separate negotiations and appears further along with Mexico than Canada. Additional U.S. tariffs on steel, aluminum, and other products have already raised effective trade barriers, and the expiry of temporary 10% tariffs on July 24 could lead to an even more complicated temporary agreement. While the most likely outcome is not a collapse of North American free trade, it appears we will be facing years of recurring negotiations, selective tariffs, and uncertainty, all of which could raise business costs and discourage long-term investment. 

France and India have been working with global tech companies, racing to build data centers, cloud infrastructure, and semiconductor capacity needed to compete in the AI race. French PM Emmanuel Macron has helped secure major investments, including SoftBank’s planned AI data centers,  leveraging the country’s nuclear power as an advantage for energy-intensive computing. Indian PM Modi has also been strengthening his relationships with major tech executives, helping attract tens of billions of dollars from Amazon, Microsoft, and Google while offering tax incentives and encouraging domestic semiconductor production. While both countries are currently behind the U.S. and China in the AI race, their efforts highlight how AI infrastructure has become a strategic national priority, with governments competing directly for investment, computing capacity, and influence. 

One million barrels. Canada has taken a big step toward a new one-million-barrel-a-day oil pipeline to the Pacific coast. This follows a federal-Alberta agreement that links a new export pipeline with carbon capture and methane reduction commitments. The proposed pipeline would largely follow the existing Trans Mountain route to a new terminal at Roberts Bank south of Vancouver, allowing access for larger crude carriers and potentially opening greater export capacity to Asia. Ottawa and Alberta are moving forward with a stronger carbon pricing framework and the Pathways carbon-capture project, which is expected to begin around 2032 and is meant to offset emissions from increased oil sands production. Still, there will be major hurdles for the project, including securing industry commitments, determining ownership among governments, and consulting with as many as 125 Indigenous groups along the route. The agreement is viewed as a political compromise, with Alberta accepting a southern route rather than its preferred northern option and the oil industry accepting more emissions obligations in exchange for an expansion of export capacity.  

Summer’s reign…and no we’re not talking weather. It wasn’t the fairy-tale weekend many Canadians had hoped for, but there was a silver lining. Canada’s historic FIFA World Cup run came to an end with a 3-0 Round of 16 loss to Morocco, but the tournament still marked Canada’s best-ever men’s World Cup performance, with the national team earning its first point, first victory and first appearance in the knockout stage. Following the match, the Canadian men’s national team reflected on a campaign that captured the country’s attention, saying in a statement that the journey is only just beginning. The weekend however, ended on a high note as Canadian swimming phenom Summer McIntosh, competing at the Canadian Swimming Trials in Montreal, broke the women’s swimming world record in the 200-metre butterfly. The 19-year-old surpassed a mark that had stood since 2009 and was widely viewed as one of the sport’s most untouchable records. McIntosh now holds four individual long-course world records, further cementing her status as one of the world’s most dominant swimmers. 


Diversion: Still got it