Housing starts missed estimates in July, falling to 229K on multi-unit softness…

… and down on a Y/Y basis, with broad-based weakness in all key provinces except Quebec.

Unabsorbed inventory took another step higher during the month, with the time on market rising sequentially…

… while construction grinded lower alongside absorption rates, continuing the trend we’ve been seeing in recent years…

… where purpose-built rental has been the only category to show strong growth.

On a net basis security flows were up small in June, with $41B of foreign investment mostly offset by $35B of Canadian investment abroad…

… led by $24B of US equity allocation (mostly big tech)…

… and $13B of corporate bond purchases, which offset another $10B of selling in treasuries (that’s $32B YTD).

The opposite dynamic played out north of the border, where foreign investment in equities was muted…

… while the appetite for Canadian debt remained strong, with $22B and $16B of new demand for government and corporate paper taking the H1 total to a record $175B.

Headline inflation of 3% came in above expectations, increasing over last month…

… on a mixed bag at the category level, with transportation doing the heavy lifting…

… as gas price inflation rebounded following some peace deal optimism.

That offset continued deceleration in grocery inflation, which is no longer the dominant driver of CPI after outpacing the measure for 24 months straight.

On Monday Carney earmarked $10B for a $70B clean energy investment in Labrador/Quebec, which would bring total capacity in the region to 14 GW and increase power exports to the US…

… through new interprovincial transmission lines and existing Quebec infrastructure. Like the Alto HSR project, it’s early - but the 23K construction jobs, $31B GDP contribution…

… and the potential impact on high-grade iron production in the Labrador Trough are reasons for optimism, given the industry’s shift to cleaner methods of steel production.

Altius Minerals (ALS) stands to benefit from these regional tailwinds, with its 3% royalty on the Kami project set to become its largest once online at ~$40M per year. With funding announced for logistics and infra planning…

… we believe the odds the project moves forward are increasing, which would warrant a lower discount rate and represent upside to our NAV estimates.

BRP Inc. (DOO) ran 8% after launching financial services, which brings an essential sales tool in-house and should help the company keep its momentum…

… so it can deliver on the growth being priced into the stock, which has recovered most of its post-tariff selloff.

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