Here’s how markets are responding to the federal election: live updates

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Polls closed last night and, while the final seat count is still to be determined with mailed ballots yet to be counted, the Liberals seem to have clinched another minority. For continuous updates on the markets’ response, follow along with the Financial Post’s Kelsey Rolfe @kelseyarolfe as she liveblogs here. For business-specific tips, announcements and information that should be added to this liveblog, please email [email protected].

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7:45 a.m. — Good morning! It’s the morning after the 44th federal election, which, at first blush, seems to have brought us near to exactly the same Parliament as we had before. The Liberal Party of Canada is projected to have won a minority government according to both the CBC and CTV News, with the Conservative Party of Canada in official opposition territory. Mail ballots still have yet to be counted, so the final seat counts may change. Follow along with the Financial Post today for more on what the market has to say about the results.

7:47 a.m. — Loonie’s up: The loonie is strengthening against the U.S. dollar this morning in Asian trading, off the back of rising oil prices and the Liberals’ projected election win, which indicated the status quo of economic supports will continue apace. Foreign investors had worried Ottawa could face a deadlock that would hamper the country’s economic recovery. The Canadian dollar was trading 0.3 per cent higher, at 1.2785, to the U.S. dollar, or 78.22 U.S. cents, after trading in a range of 1.2779 to 1.2830.

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8:37 a.m — Market impact minimal: “As you were, Canada,” BMO economists Robert Kavcic and Carl Campus wrote in an early morning note to clients, saying that the results likely means “fiscal policy will largely remain on its current course.” The market impact is “minimal” so far, with only the loonie modestly higher, though they noted the currency is more influenced by broader market forces than the election at this point. Markets steadied this morning after taking a battering due to concerns that major Chinese property developer Evergrande’s insolvency could “ripple through the financial system.” U.S. equity futures “point to a positive open this morning,” and 10-year Treasury yields are up just under three basis points, to 1.34 per cent.

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While the shelf life of minority governments isn’t terribly long, Kavcic and Campus said this election could herald a period of stability given Canadians’ clear lack of enthusiasm for going to the polls.

8:45 a.m. — Small biz reacts: Canadian Federation of Independent Business president and chief executive officer Dan Kelly called on Twitter for the federal government to extend the wage and rent subsidy “immediately,” return the maximum supports to 75 per cent, and adopt the NDP and Green Party promise to extend subsidies until all pandemic restrictions are lifted. He also called for businesses that opened after March 2020 to be included in the supports. Prime Minister Justin Trudeau has previously promised the government would “work on potential solutions” to help ineligible business operators, such as new owners.

The government should reopen the Canadian Emergency Business Account program, Kelly said, and move on the Liberal promise to extend the Canada Recovery Hiring program until the end of March.

“Passports and other COVID restrictions are mounting once again, limiting prospects for a small biz recovery,” he wrote. “Many businesses (are) reporting a further drop in sales just as the feds are phasing out the rent and wage subsidy.”

Kelly also called on the government to support small businesses who have to enforce proof of vaccination. Part of the Liberals’ promised $1-billion provincial vaccine passport launch fund should be put toward the staffing and technology small business owners will need, he said.

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