As far as Michael Medline is concerned, his turnaround plan at Sobeys is “starting to take root.” The grocer’s parent, Empire Company (EMPa.TO), reported fiscal fourth-quarter sales and earnings that beat estimates Wednesday morning. Context is important: while the results were ahead of expectations, adjusted profit fell almost 50 per cent from the previous year.

And by no means is Medline declaring mission accomplished. He said this morning Empire still isn’t “where we want to be.” Today the big question is whether he can keep investors satisfied after the stock’s big rally since he was appointed, particularly with the prospect of Jeff Bezos expanding his empire into the grocery aisles. 

LOONIE AT HIGHEST SINCE FEBRUARY

Canada’s currency is back above 76 cents U.S. What's particularly impressive is that it’s holding above that level, at least for now, despite oil trading lower this morning on the back of yesterday’s inventory report from the American Petroleum Institute. No doubt there’s still a big Canadian discount on the dollar, but it was only a few weeks ago that it was hovering around 73 cents U.S. We’ll consider whether the recent run is enough to change behaviour (both for consumers and business leaders), and how much the dollar has riding on the Bank of Canada’s rate decision on July 12.

YELLEN PUTS INVESTORS ON NOTICE

“Asset valuations are somewhat rich if you use some traditional metrics like price-to-earnings ratios,” Fed Chair Janet Yellen said yesterday in London; then adding in the next breath, “But I wouldn’t try to comment on appropriate valuations.” In some respects, it was too late to walk back the warning on “rich” valuations. Will investors heed her words of caution? 

PETYA WATCH

The latest global ransomware attack continues to spread. A couple of important questions: Who should take the fall at companies that were left vulnerable? And why does it seem as though Canada, by and large, has been spared from this attack and WannaCry?

OTHER NOTABLE STORIES:

- Shaw Communications (SJRb.TO) came in a bit shy of expectations in the third quarter with its 27-cent per-share profit on $1.3 billion in revenue. Notably, it swung to subscriber growth, with a net gain of 58,000 customers - including 20,000 who signed up for its wireless service. Shaw also narrowed its full-year operating income forecast to a range of $2.135 billion to $2.16 billion.

- Home Capital (HCG.TO) continues to bask in the glow of Warren Buffett’s backstop. The lender said late yesterday its GIC deposit base rose to $12.08 billion as of Monday, compared with $12.01 billion a week earlier.

- Alberta Energy Regulator CEO Jim Ellis wants higher standards on foreign investment in the oil patch. “We need to have a better view as to who is doing business in Alberta,” he told The Globe and Mail in an interview, amid concern about inexperienced foreign players in the province. 

- It was a second day of sharp declines for Arconic (ARNC.N) yesterday. The Alcoa spinoff fell nine per cent after tumbling as much as 11.3 per cent on Monday amid controversy over panels used in the Grenfell tower.

- A bidding war is breaking out for Sandvine (SVC.TO). The company said late yesterday Francisco Partners has tabled a takeover offer at $4.15 per share. Sandvine previously agreed to Vector Capital’s $3.80/share. Vector now has a five-day “matching period.”  

NOTABLE RELEASES/EVENTS

- Notable earnings: Empire Company, Shaw Communications, AGF Management

- 9:30 a.m. ET: Bank of Canada Governor Stephen Poloz participates in panel discussion hosted by the European Central Bank in Portugal

- 1:10 p.m. ET: Justin Trudeau makes announcement alongside Ontario Premier Kathleen Wynne, Toronto Mayor John Tory and Waterfront Toronto CEO Will Fleissig

- 2:20 p.m. ET: Bank of Canada Deputy Governor Lynn Patterson delivers speech in Calgary.

- 4:30 p.m. ET: U.S. Federal Reserve releases Comprehensive Capital Analysis and Review