CANADA ADDS SURPRISING NUMBER OF JOBS 

Another month, another stunning Canadian jobs report. 54,500 jobs were created last month. That's almost five-times Bay Street's expectations. Central Canada and B.C. led the gains. And there are encouraging signs about the quality of work, with 77,000 full-time jobs added in the month. Throughout the day we’ll provide a detailed analysis of gainers and laggards among the sectors and provinces. 

U.K. ELECTION SHOCKER 

Theresa May's decision to call a snap election ahead of Brexit negotiations has backfired in spectacular fashion. Her Conservative party lost its majority in the vote – and now the PM is looking to rally enough support to form government. The so-called "hung parliament" creates more questions than answers and leaves the Prime Minister with a weakened hand heading into crucial talks with the European Union. And that's readily apparent in the markets this morning. The British pound plunged as much as three cents against the U.S. dollar in overnight trading. That said, perspective is everything: GBP is still trading above where it stood the day before May triggered the election.

Some basic questions:

-Will May fight on as Prime Minister? British media is citing sources who say she has no intention of resigning. She will visit Buckingham Palace at 7:30 a.m. ET at which time she’s expected to map out a plan to form a government with the support of the Democratic Unionist party.

-Will Brexit negotiations start as planned on June 19? European Council President Donald Tusk tweeted this: "We don't know when Brexit talks start. We know when they must end. Do your best to avoid a ‘no deal’ as result of ‘no negotiations’

-Will the U.K. carry on with May's vision for a so-called hard Brexit?

-What are the implications for Canada insofar as trade relations go with the EU and a potential eventual trade deal with the U.K.?

MNUCHIN IN OTTAWA

U.S. Treasury Secretary Steven Mnuchin arrives in Ottawa this morning for meetings with Finance Minister Bill Morneau, as well as other cabinet members and Canadian business leaders. A senior U.S. Treasury official yesterday doused any hope for major announcements about trade irritants. Seems like tax reform and regulatory matters are expected to be discussed. More on that here.

HOME CAPITAL RALLIES

Shares of Home Capital Group soared as much as 13.07 per cent yesterday before eventually closing with a 12.97 per cent gain at $10.89 – the highest close since shares went into a tailspin in late April after the lender initially disclosed early signs of an eroding deposit base. The Globe and Mail and Financial Post are both reporting HCG is in settlement talks with the Ontario Securities Commission. The Globe is also reporting HCG has received some early indications of takeover interest. Spokespeople for HCG and the OSC declined to comment. Should be pointed out HCG’s annual meeting is just a few weeks away. We should consider how motivated the company is to clear up some of the controversy before June 29.

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BNN Advisor

Vancouver: Housing concerns cross generations

Winnipeg and Saskatchewan: The loonie and U.S. protectionism weigh on Central Canada

Yellowknife and Whitehorse: The hurdles of northern living and aboriginal issues

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POLOZ: ‘ANYTHING’ COULD TRIGGER A CORRECTION IN TORONTO AND VANCOUVER

I’m still amazed by what the Bank of Canada governor said yesterday during his post-FSR news conference. “Price increases in Vancouver and Toronto have an element of speculation to them...The longer that goes, the bigger it gets, the more you start to be concerned that not necessarily a global recession, but just about anything could be responsible for causing a correction in housing.” We should continue contemplating the message that sends homeowners and wishful buyers.

OTHER NOTABLE STORIES

-The news is well established: HBC cutting 2,000 jobs amid a widening quarterly loss and deteriorating sales. Can the retailer cut its way to a better customer experience in store and online? And not to be lost amid all the interest in job cuts, the retailer made it clear in yesterday’s quarterly report that it’s still eyeing ways to cash in on its real estate.

-Big screaming headline above the fold on A1 of today’s Globe: “World Bank probing Bombardier deal”. The deal in question is a US$340-million rail contract in Azerbaijan. The probe is about whether or not bribery was involved. As Paige Ellis pointed out this morning, however, the situation was previously disclosed by Bombardier. 

-We’ve got another foreign exit from Canada’s energy sector, with a different foreign player stepping in to fill the void. Centrica’s Canadian JV with Qatar is being sold to a group led by Hong Kong’s MIE Holdings for $722 million.

-It’s tax freedom day. The Fraser Institute says today’s the day when Canadians “start working for themselves.” And it only took nearly half the calendar year to get there.

-Encana announced this morning it will sell its Piceance natural gas assets in Colorado to Caerus Oil and Gas for $735 million. "This transaction advances our strategy, makes the company more efficient and delivers significant proceeds that we will use to further strengthen our balance sheet," Encana CEO Doug Suttles said in a statement.

NOTABLE RELEASES/EVENTS

-Notable data: Canadian labour force survey (8:30 a.m. ET Thomson estimate: +11,000 jobs, 6.6 per cent unemployment), Canadian industrial capacity utilization (8:30 a.m. ET)

9:15 a.m. ET: Morneau greets Mnuchin at Centre Block

1000 a.m. ET: Mnuchin joins Morneau and Chrystia Freeland for roundtable with cabinet members  

11:30 a.m. ET: Mnuchin, Morneau join roundtable hosted by Business Council of Canada  

1:30 p.m. ET: Mnuchin, Morneau hold bilateral meeting 

2:20 p.m. ET: Mnuchin, Morneau hold news conference

Every morning BNN's Managing Editor Noah Zivitz writes a ‘chase note’ to BNN's editorial staff listing the stories and events that will be in the spotlight that day. Have it delivered to your inbox before the trading day begins by heading to www.bnn.ca/subscribe.