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Wednesday March 29, 2017

S&P/TSX Composite 92.35 15598.57 CANADA Dow Jones 150.73 20701.71 S&P 500 16.99 2358.58 The S&P/TSX rose on Tuesday despite a pullback in precious metal NASDAQ 39.16 5879.53 names. Barrick Gold (ABX) has reached an agreement with Goldcorp S&P/TSX Venture -0.02 804.12 (G) to form a new joint venture (JV) partnership at the Cerro Casale Crude Oil (US$/brrl) 0.63 48.36 Project in Chile, one of the world's largest undeveloped gold and copper Gas (US$/mmbtu) 0.03 3.16 deposits. As part of Goldcorp’s JV in Chile, the company also announced Copper (US$/lb) 0.04 2.67 the acquisition of Exeter Resource (XRC) for roughly C$247M in an all Gold (US$/oz) -5.70 1253.10 share transaction.

Nickel (US$/lb) -0.05 4.50 Barkerville Gold Mines (BGM) announced that it entered into agreement Palladium (US$/oz) -3.85 794.60 with Osisko Gold Royalties (OR), whereby Osisko has agreed to purchase Platinum (US$/oz) -11.50 956.90 an additional 0.75% net smelter return (NSR) royalty on BGM’s Cariboo Silver (US$/oz) 0.05 18.16 gold project for cash consideration of ~$12.5M. Uranium (US$/lb) 0.00 24.65 -0.0003 0.7471 Home Capital Group (HCG) plummeted on Tuesday after saying that it 10-Year Canada 1.40 had terminated the employment of its CEO, Martin Reid, immediately and 10-Year U.S. 2.42 will no longer serve on any of the boards of directors of the firm or its Volatility Index (VIX) -1.02 11.48 subsidiaries. According to The Wall Street Journal, former Valeant Pharmaceuticals (VRX) Chief Executive Michael Pearson has filed a A Diamond In The… Egg? lawsuit against the company, alleging it refused to pay him more than 3M

shares he is owed. Finding a pearl in an oyster is one thing, but what about a Grande West Transportation (BUS), the Canadian maker of heavy-duty diamond in a hard-boiled egg? mid-sized transit buses, announced it has secured a manufacturing

A woman in the U.K. was agreement to produce Vicinity buses in Atlanta, Georgia that meets FTA having some boiled eggs for Buy America requirements.

breakfast when she says she felt something funny in her mouth. UNITED STATES

“I took one, peeled it and bit into it when I feel U.S. equities rose on Tuesday as investors digested strong consumer something like gristle in my mouth. It fell on confidence data, with financials and energy leading. Olive Garden owner to the plate and I couldn’t understand where it Darden Restaurants (DRI) said it would buy Cheddar's Scratch Kitchen had come from.” for $780M in an all-cash transaction.

She went searching for answer and went to a Carnival (CCL), the world's largest cruise operator, reported a better- nearby chicken farm and was told it’s possible than-expected quarterly profit on Tuesday, helped by higher ticket prices the diamond could have passed through the and on-board spending. Snap (SNAP) was under pressure on Tuesday bird. “Basically the shell coating goes on last after Facebook (FB) announced it was beefing up its camera features, making its app more like Snapchat. and doesn’t harden until it hits the air ... In this case it could be chicken swallows diamond, Tesla (TSLA) saw a much needed cash injection after Chinese tech giant diamond gets stuck at intestine exit, egg picks Tencent Holdings acquired a 5% stake in the company for $1.78B. Shares up diamond on way out.” of shipping stocks were floating higher yesterday after a major Wall Street Analyst issued bullish commentary on several dry bulk shipping names, notably Safe Bulkers (SB) and Star Bulk Carriers (SBLK).

This publication is a general market commentary and does not constitute a research report. Any reference to a research report or a recommendation is not intended to represent the whole report and is not itself a research report or recommendation. This commentary is for informational purposes only and does not contain investment advice. This publication may be wholly or partially based on industry rumour, gossip and innuendo and as such is not to be relied upon as investment advice. Not authorized for distribution into the United States or to U.S. persons. Canaccord Genuity Wealth Management is a division of Canaccord Corp. Member – Canadian Investor Protection Fund.

Wednesday March 29, 2017 2

ECON 101

CANADIAN Data Today: No scheduled releases.

U.S. Data Today: This morning, Pending Home Sales for the month of February are expected to increase to 2.5%, better than the -2.8% drop seen in the month prior.

CANADIAN EQUITIES OF INTEREST Listed Alphabetically by Symbol

Marijuana Aurora Cannabis Inc* (ACB : $2.60), Net Change: 0.07, % Change: 2.77%, Volume: 6,993,255 Canopy Growth Corp* (WEED : $10.92), Net Change: -0.06, % Change: -0.55%, Volume: 4,988,064 Aphria Inc* (APH : $6.54), Net Change: -0.18, % Change: -2.68%, Volume: 2,112,421 Emblem Corp* (EMC : $2.44), Net Change: -0.05, % Change: -2.01%, Volume: 631,398 Organigram Holdings Inc* (OGI : $2.57), Net Change: 0.10, % Change: 4.05%, Volume: 1,822,153 Supreme Pharmaceuticals Inc* (SL : $1.55), Net Change: -0.04, % Change: -2.52%, Volume: 811,613 Ianthus Capital Holdings Inc* (IAN : $2.93), Net Change: -0.05, % Change: -1.68%, Volume: 44,650 MARIJUANA TAXES, GST AND THE CRA. The Canadian Press reports that the Liberal government is still grappling with how to tax recreational cannabis. Canadian Finance Minister Bill Morneau said Monday that the government “ha[sn]’t made enough progress” in terms of taxing marijuana and several other issues related to its legalization. Recall, the Task Force on Cannabis Legalization and Regulation recommended that after a proper economic analysis is performed, a tax and pricing structure should be put in place that balances health protection with the ultimate goal of eliminating the illicit market. In the view of Canaccord Genuity Life Science Analysts Neil Maruoka and Matt Bottomley, the government could influence usage patterns through differential taxation; for example, by imposing maximums on THC levels in recreational cannabis and taxing potent marijuana at higher levels. Canaccord Genuity believes it is critical that retail prices (inclusive of all mark-ups and taxation) remain below the price of the illicit market in order to pressure illegal producers out of the market; this would disproportionately affect those illegal producers that are unlikely or unable to compete with the quality of regulated production from licenced producers. Moreover, Canaccord Genuity believes that cannabis may not be taxed right out of the gate, in order to shift users away from the illicit market with competitive pricing.

Barrick Gold Corp* (ABX : $25.55), Net Change: -0.65, % Change: -2.48%, Volume: 3,040,632 Barrick Gold Corp* (ABX : US$19.08), Net Change: -0.52, % Change: -2.65%, Volume: 11,265,157 Goldcorp Inc* (G : $19.98), Net Change: -1.48, % Change: -6.90%, Volume: 5,675,143 Goldcorp Inc* (GG : US$14.94), Net Change: -1.11, % Change: -6.92%, Volume: 20,551,772 Kinross Gold Corp* (K : $4.53), Net Change: -0.12, % Change: -2.58%, Volume: 4,951,242 Kinross Gold Corp* (KGC : US$3.40), Net Change: -0.08, % Change: -2.30%, Volume: 13,175,040 COME TOGETHER RIGHT NOW OVER ME. Two senior gold producers are partnering to move one of the world's largest undeveloped gold and copper deposits forward. Barrick Gold has reached an agreement with Goldcorp to form a new joint venture (JV) partnership at the Cerro Casale Project in Chile. Under the terms of the agreement, Goldcorp has agreed to purchase a 25% interest in Cerro Casale from Barrick. This transaction, coupled with the concurrent purchase by Goldcorp of Kinross Gold's 25% interest in Cerro Casale, will result in a 50/50 JV between Barrick and Goldcorp. As consideration for the 25% interest acquired from Barrick, Goldcorp will fund Barrick's first US$260M of expenditures on the project following the formation of the JV, and will spend an equivalent amount on its own behalf for a total project investment commitment of US$520M. Under the agreement, Goldcorp must spend a minimum of US$60M in the two-year period following closing, and then US$80M in each successive two-year period. Goldcorp will also fund the Cerro Casale JV's acquisition of a 100% interest in the adjacent Quebrada Seca property from Kinross upon closing. Goldcorp has granted Barrick a 1.25% royalty interest on 25% of gross revenues derived from metal production from both Cerro Casale and Quebrada Seca. The transaction is expected to close in Q2. Goldcorp has entered into a separate agreement for the acquisition of Exeter Resource (XRC), whose sole asset is the Caspiche Project, located ~10 km north of Cerro Casale. Following closing of this acquisition, Goldcorp will contribute the Caspiche Project into the Cerro Casale JV. Fifty percent of the acquisition costs incurred by Goldcorp will be deducted from the US$260M expenditure commitment. Cerro Casale is one of the world's largest undeveloped gold and This publication is a general market commentary and does not constitute a research report. Any reference to a research report or a recommendation is not intended to represent the whole report and is not itself a research report or recommendation. This commentary is for informational purposes only and does not contain investment advice. This publication may be wholly or partially based on industry rumour, gossip and innuendo and as such is not to be relied upon as investment advice. Not intended for distribution within the United States. Canaccord Genuity Wealth Management is a division of Canaccord Corp. Member – Canadian Investor Protection Fund.

Wednesday March 29, 2017 3

copper deposits, located in the Atacama Region of northern Chile.

Agnico Eagle Mines Ltd* (AEM : $57.62), Net Change: -2.09, % Change: -3.50%, Volume: 587,649 Agnico Eagle Mines Ltd* (AEM : US$43.09), Net Change: -1.55, % Change: -3.47%, Volume: 1,824,751 PADDING THE PIGGY BANK. Late Monday, Agnico Eagle Mines issued and sold 5,003,412 common shares of the company to an unnamed U.S. institutional investor at a price of US$43.97 per common share, for total consideration of ~US$220M. The raise was done at a 1.50% discount to the company’s Monday closing price. The net proceeds of the offering will be used for general corporate purposes. In February, Agnico gave the green light for its two key Northern development assets: Amaruq and Meliadine. While free cash flow (FCF) will suffer near term, Canaccord Genuity Precious Metals Analyst Tony Lesiak sees strong potential returns and low execution risk with the development plans as Agnico has strong experience in the North and a solid balance sheet to meet any FCF shortfalls. Management also announced the go-ahead for Bousquet (LaRonde 5), suggested more confidence (given recent exploration success) in deepening LaRonde, developing El Barqueno, and expanding both Kittila and La India. Lesiak continues to see more optionality in Agnico’s development pipeline than any other gold producer under his research coverage universe.

Aurora Cannabis Inc* (ACB : $2.60), Net Change: 0.07, % Change: 2.77%, Volume: 6,993,255 G'DAY MATE, WOULD YOU LIKE SOME VEGEMITE? Aurora Cannabis announced it has participated in an IPO financing that will give the company a 19.9% equity stake in Cann Group Ltd., the first licenced producer (LP) to be licensed for the research and cultivation of medical cannabis in Australia. Canaccord Genuity Life Sciences Analyst Neil Maruoka views this to be incrementally positive for Aurora, creating a differentiated international strategy in the emerging Australian cannabis market (and similar to Canopy Growth’s (WEED) relationship with AusCann). Further, by expanding into new global markets, Maruoka believes that Aurora can somewhat mitigate the risk and uncertainty around the legalization of marijuana for recreational use in Canada. Although Maruoka believes that the Australian cannabis market is likely two to three years behind Canada in terms of regulation and development, he believes it could provide a significant opportunity for Canadian LPs as it matures.

Barkerville Gold Mine Ltd* (BGM : $0.52), Net Change: 0.05, % Change: 9.47%, Volume: 879,110 Osisko Gold Royalties Ltd* (OR : $14.98), Net Change: -0.41, % Change: -2.66%, Volume: 493,354 ALL TOLD, IT’S ALL ABOUT THE GOLD. Barkerville Gold Mines announced on Monday that it entered into agreement with Osisko Gold Royalties, whereby Osisko has agreed to purchase an additional 0.75% net smelter return (NSR) royalty on BGM’s Cariboo gold project for cash consideration of ~$12.5M. Upon completion of the royalty purchase, Osisko's total NSR royalty will be 2.25%. The grant of the additional royalty will cancel Osisko's royalty right which was granted in an agreement between Osisko and BGM dated Feb. 5, 2016. Osisko will, however, retain a right of first refusal relating to any gold stream offer received by BGM with respect to the Cariboo project. Separately, on Tuesday BGM releases additional results from the continuing 130,000-metre phase II Island Mountain exploration drilling program at Cariboo. The company is currently exploring and delineating Island Mountain with seven drill rigs and has now relocated an eighth rig to the Valley Zone which occurs between Cow and Island Mountains. Some highlights from the results include an intersection of 12.52 g/t Au over 3.70 metres and another intercept of 24.70 g/t Au over 6.60 metres in the same hole. BGM says the program intends to determine the extent of the vein systems that were historically never explored, and is aimed at discovering new vein systems and sulphide replacement bodies that will ultimately inform a maiden resource.

Grande West Transportation Inc* (BUS : $3.30), Net Change: 0.11, % Change: 3.45%, Volume: 1,264,916 New Flyer Industries Inc* (NFI : $48.41), Net Change: 0.65, % Change: 1.36%, Volume: 213,728 THE LITTLE BUS THAT COULD. Grande West Transportation, the Canadian maker of heavy-duty mid-sized transit buses, announced it has secured a manufacturing agreement to produce Vicinity buses in Atlanta, Georgia that meets FTA Buy America requirements. Alliance Bus Group (ABG), Grande West's exclusive U.S. distributor, will produce Buy America compliant Vicinity buses for sale to U.S. transit authorities. This announcement comes on the heels of Grande West’s first U.S. public transit order announced on Monday. The Metropolitan Atlanta Rapid Transit Authority ordered 10 Vicinity buses this week. Doug Dunn, CEO of ABG said, "Given the large amount of bid activities we are currently engaged in, we are confident that many more Vicinity orders will follow." It's David versus Goliath when comparing Grande West to New Flyer Industries but, how many orders will Grande West need to win before New Flyer sits up and takes notice that maybe its mid-sized product offering isn't all that good? New Flyer is the leading manufacturer of heavy-duty transit buses and motor coaches in North America. YTD, shares of Grande West are up more than 115% while New Flyer shares are up nearly 20%.

This publication is a general market commentary and does not constitute a research report. Any reference to a research report or a recommendation is not intended to represent the whole report and is not itself a research report or recommendation. This commentary is for informational purposes only and does not contain investment advice. This publication may be wholly or partially based on industry rumour, gossip and innuendo and as such is not to be relied upon as investment advice. Not intended for distribution within the United States. Canaccord Genuity Wealth Management is a division of Canaccord Corp. Member – Canadian Investor Protection Fund.

Wednesday March 29, 2017 4

Goldcorp Inc* (G : $19.98), Net Change: -1.48, % Change: -6.90%, Volume: 5,675,143 Exeter Resources Corp* (XRC : $2.41), Net Change: 0.87, % Change: 56.49%, Volume: 3,946,555 A STORYBOOK HAPPY ENDING. Exeter Resource, headed by former Canaccord Genuity Mining Analyst Wendell Zerb, is being acquired by Goldcorp in an all share transaction. Goldcorp will acquire all of the outstanding shares of Exeter under a plan of arrangement for consideration of 0.12 of a Goldcorp share for each Exeter share, which represents a value equivalent to C$2.58 per Exeter share, based on the closing price of Goldcorp shares on the TSX on Monday, March 27, 2017, and total consideration of C$247M. Exeter's Board of Directors has unanimously approved the transaction and recommends that Exeter shareholders vote in favour of the arrangement. All of the directors and officers of Exeter, who own or control ~8.4% of Exeter's issued and outstanding shares, have entered into support agreements with Goldcorp pursuant to which they have agreed to support the transaction and vote their Exeter shares in favour of the arrangement. The transaction is expected to close no later than June 30, 2017. Exeter is focused on the exploration and development of the Caspiche project in Chile. Caspiche is well located in Chile’s Maricunga district. Goldcorp with its joint venture partner in the Maricunga Gold Belt, Barrick Gold (ABX) should have the technical and financial capability to advance the Caspiche project to production at a scale commensurate with the size of the available resources.

Dollarama Inc* (DOL : $99.83), Net Change: 0.21, % Change: 0.21%, Volume: 379,150 LOOKING FOR A BIRTHDAY GIFT FOR THAT SPECIAL SOMEONE AND DON'T WANT TO SPEND MORE THAN $4.00? Dollarama, Canada’s top dollar store with nearly 1,100 locations, will report Q4/F17 earnings results on Thursday, March 30, before market open. Canaccord Genuity Consumer & Retail Analyst Derek Dley is looking for revenue of $842M, up 11% YoY. Dley’s EBITDA estimate of $199M is ahead of Q4/F16 at $190M, while his EPS estimate of $1.08 is above last year's $1.00, and slightly below consensus' $1.12. Dley is forecasting same-store sales growth of 3.0%, driven by a higher YoY average basket size, modestly offset by what he believes was softer traffic due to unfavourable weather, during the , along with 6.7% YoY square footage growth. Dley is forecasting gross margins as a percentage of revenue of 39.0%, down from last year at 40.8%, which benefited from a favourable currency adjustment. Dley’s gross margin estimate is in line with the high end of the company’s guidance range for F2017. Finally, Dley expects Dollarama will remain active repurchasing shares over the course of F2017, given its flexible balance sheet, with net debt/EBITDA of only 1.6x, and the current buyback for 6.0M shares or roughly 5.0% of the company’s shares outstanding.

Home Cap Grp Inc* (HCG : $25.06), Net Change: -2.66, % Change: -9.60%, Volume: 1,127,930 “YOU’RE FIRED!” – WHAT DONALD TRUMP SAYS IN THE MIRROR EVERY MORNING. Shares of Home Capital Group plummeted on Tuesday after saying that it had terminated the employment of its CEO. Martin Reid, who had been with Home Capital for a decade, but only served as CEO for less than a year, will leave immediately and no longer serve on any of the boards of directors of the firm or its subsidiaries. The move comes amid a continuing review of Home Capital and its executives by the Ontario Securities Commission (OSC). The regulator said earlier this month that it had served enforcement notices to past and current company management related to the disclosure of an investigation into fraudulent mortgage documents. Independent investor and well-known short-seller Marc Cohodes took to BNN and reiterated his call for greater regulatory scrutiny of the company following Reid’s dismissal. Cohodes, whose allegations of impropriety at the company have not been proven, called for a full investigation of Home Capital. Cohodes said he has no interest in exiting his short position in Home Capital until all traces of former CEO Gerald Soloway’s regime have been expunged from the firm. Soloway remains the third-largest shareholder in the company, holding a 5.5% stake despite retiring in May 2016. The OSC notice relates to the way that the company told its investors that it had suspended 45 mortgage brokers. That move was related to the brokers’ submission of fake or altered income verification documents in 2014 and 2015.

Valeant Pharmaceuticals Intl* (VRX : $14.34), Net Change: -0.15, % Change: -1.04%, Volume: 636,051 Valeant Pharmaceuticals Intl * (VRX : US$10.68), Net Change: -0.13, % Change: -1.20%, Volume: 8,384,168 IN BREACH-OF-CONTRACT? According to The Wall Street Journal, former Valeant Pharmaceuticals Chief Executive Michael Pearson has filed a lawsuit against the company, alleging it refused to pay him more than 3M shares he is owed. Pearson filed the suit on Monday in the U.S. District Court of New Jersey, saying Valeant breached his contract by not paying him 580,676 shares and 2.5M performance shares due in November under the terms of his separation agreement. The lawsuit also alleges Valeant also owes Pearson $180,000 for consultation fees. Earlier this month, long-time Valeant supporter Pershing Square Capital Management eliminated its remaining position in Valeant, selling 27.2M shares at a price of ~US$11. Pershing Square representatives Bill Ackman and Steve Fraidin will remain on the board until Valeant’s AGM, but will not

This publication is a general market commentary and does not constitute a research report. Any reference to a research report or a recommendation is not intended to represent the whole report and is not itself a research report or recommendation. This commentary is for informational purposes only and does not contain investment advice. This publication may be wholly or partially based on industry rumour, gossip and innuendo and as such is not to be relied upon as investment advice. Not intended for distribution within the United States. Canaccord Genuity Wealth Management is a division of Canaccord Corp. Member – Canadian Investor Protection Fund.

Wednesday March 29, 2017 5

stand for re-election. This brings to a close Pershing’s relationship with Valeant that began with a concerted but failed effort to acquire Allergan in 2014. According to reports, Pershing felt that its investment in Valeant required a disproportionate amount of effort and it was unlikely that Pershing would recoup its losses. Canaccord Genuity Life Sciences Analyst Neil Maruoka believed Pershing’s move underscored his concerns about Valeant’s lower growth and challenges associated with its asset divestiture strategy.

U.S. EQUITIES OF INTEREST Listed Alphabetically by Symbol

Amazon.Com Inc (AMZN : US$855.65), Net Change: 8.83, % Change: 1.04%, Volume: 2,996,880 PEOPLE IN DUBAI DON'T LIKE THE FLINTSTONES. BUT PEOPLE IN ABU DHABI DO! Amazon has agreed to buy Middle East online retailer Souq.com, thwarting a last minute bid by Dubai billionaire Mohamed Alabbar's Emaar Malls. The value and terms of the deal were not disclosed. The acquisition is expected to close in 2017, according to a joint statement on Tuesday. Reuters reported last week that Amazon had agreed in principle to buy Souq.com. Souq.com is an English-Arabic language e-commerce platform, often described as the Amazon of the Middle East. It is the largest e-commerce platform in the Arab world. Amazon is paying less than Emaar's offer of $800M, Reuters reports, making it lower than the $1B valuation at the time of Souq.com's funding round last year. Analysts say that in buying Souq.com, Amazon will leapfrog into the crucial Mideast markets of Egypt, the United Arab Emirates and Saudi Arabia, where the Dubai-based retailer already has local operations. "By becoming part of the Amazon family, we'll be able to vastly expand our delivery capabilities and customer selection much faster, as well as continue Amazon's great track record of empowering sellers. This is a milestone for the online shopping space in the region," Souq.com Co-Founder Ronaldo Mouchawar said in the statement. Carnival Corp New (CCL : US$59.26), Net Change: 0.39, % Change: 0.66%, Volume: 7,300,583 WHERE IT’S SENIORS DAY EVERYDAY. Carnival, the world's largest cruise operator, reported a better-than-expected quarterly profit on Tuesday, helped by higher ticket prices and on-board spending. On-board spending, which makes up about a quarter of Carnival's total revenue, rose 6% in Q1 as the company added more entertainment options such as casinos and IMAX (IMAX) theaters to its cruises. Cruise operators and travel companies have benefited as consumers increasingly spend more on travel, fine dining and big ticket items rather than on apparel and accessories. For the quarter, net income was $352M, or 48 cents per share, up from $142M, or 18 cents per share last year. Adjusted EPS was 38 cents, beating the average analyst estimate for 35 cents. Revenue was $3.8B for the quarter, up from $3.7B last year and was in-line with forecasts. The company expects Q2 adjusted EPS of 43 cents to 47 cents, compared with analyst estimates for 46 cents. The company also raised the full-year outlook to a range of $3.50 to $3.70 from December guidance of $3.30 to $3.60.

Darden Restaurants Inc (DRI : US$82.61), Net Change: 7.03, % Change: 9.30%, Volume: 10,664,901 WHO EVER REQUESTED “ALL YOU CAN EAT” BREAD STICKS? Olive Garden owner Darden Restaurants said it would buy Cheddar's Scratch Kitchen for $780M in an all-cash transaction. Darden said it would buy the restaurant chain from its shareholders including private equity-firms L Catterton and Oak Investment Partners. Cheddar's has 165 locations across 28 states, and is a casual dining concept featuring made-from-scratch recipes. Darden said it expects the transaction to be accretive to its adjusted earnings for fiscal 2018 by about 12 cents per share. The company also reported better-than-expected Q3 revenue and profit and forecast full-year profit above estimates. Darden reported EPS of $1.32 a share and surpassed Canaccord Genuity Restaurant Analyst Lynne Collier’s $1.27 estimate. Once again Olive Garden posted better-than-expected same store sales of 1.4% versus Collier’s projection of 0.0% and a significant acceleration on a two-year stack (8.2% in Q3/17 versus 3.6% in Q2/17). With this beat, Darden raised the mid-point of EPS guidance by $0.05 to $3.95-$4.00 for FY17.

Dryships Inc (DRYS : US$1.50), Net Change: 0.11, % Change: 7.91%, Volume: 20,560,651 Golden Ocean Group Ltd (GOGL : US$8.06), Net Change: 0.65, % Change: 8.77%, Volume: 1,047,273 Seaspan Corp (SSW : US$6.47), Net Change: 0.35, % Change: 5.72%, Volume: 1,070,869 Genco Shipping & Trading Ltd (GNK : US$12.08), Net Change: 1.02, % Change: 9.22%, Volume: 217,316 Safe Bulkers Inc (SB : US$2.12), Net Change: 0.23, % Change: 12.17%, Volume: 3,394,183 Star Bulk Carriers Corp (SBLK : US$11.67), Net Change: 1.56, % Change: 15.43%, Volume: 1,770,991 WHAT DO YOU DO WITH A SICK BOAT? TAKE IT TO THE DOC. Shares of shipping stocks were floating higher yesterday after a Wall Street analyst issued bullish commentary on several dry bulk shipping names. The analyst cited a This publication is a general market commentary and does not constitute a research report. Any reference to a research report or a recommendation is not intended to represent the whole report and is not itself a research report or recommendation. This commentary is for informational purposes only and does not contain investment advice. This publication may be wholly or partially based on industry rumour, gossip and innuendo and as such is not to be relied upon as investment advice. Not intended for distribution within the United States. Canaccord Genuity Wealth Management is a division of Canaccord Corp. Member – Canadian Investor Protection Fund.

Wednesday March 29, 2017 6

recovery in global steel markets and said dry bulk shippers are the final link in the global steel market recovery story. The analyst upgraded three names: Safe Bulkers, Star Bulk Carriers and Golden Ocean Group saying "These companies have young fleets, mostly larger vessels, low cost structures, high operational and financial leverage to repricing in the dry bulk segment, and ability to start paying dividends in YE2018." He also upgraded Genco Shipping. The analyst said strong steel fundamentals and muted fleet supply should power a shipping recovery and that the dry bulk market has passed through its cyclical lows and is headed toward profitability. "Stocks have rallied, yet we see more upside as freight rates have lagged steel prices by ~30% & as companies approach dividend payout," the analyst wrote. For an easier way to play the shipping theme, take a look at the Guggenheim Shipping ETF (SEA) which currently yields about ~5.7%.

General Motors Company (GM : US$35.56), Net Change: 0.85, % Change: 2.45%, Volume: 29,560,542 ALL LIGHTS MATTER. Hedge fund billionaire David Einhorn called on Tuesday for General Motors to dramatically change its capital structure by splitting its stock into two classes as part of a new capital allocation plan. Einhorn, the founder of $9B hedge fund Greenlight Capital, wants shareholders to pressure GM to offer one class of stock that would receive the car manufacturer’s current dividends and another that would be more growth oriented. “Our plan would unlock significant value and lower GM’s cost of capital. It would provide the company complete strategic flexibility without adding any default, refinancing, or balance sheet risk,” Einhorn said in a statement. He believes the split will attract new investors that would be willing to pay more for potential earnings growth which could boost the company's market cap by as much as $38B. CNBC reports that GM and Einhorn have been talking for about seven months, but GM is said to have "made it clear" to Greenlight Capital that it is not interested in pursuing a dual share class proposal.

Facebook Inc (A) (FB : US$141.75), Net Change: 1.43, % Change: 1.02%, Volume: 14,527,117 Snap Inc (SNAP : US$22.21), Net Change: -1.62, % Change: -6.80%, Volume: 49,506,937 FLOWER CROWN FILTER, ALL DAY, ER’DAY. Snap was under pressure on Tuesday after Facebook announced it was beefing up its camera features, making its app more like Snapchat. Facebook unveiled three new features Tuesday, including Facebook Camera Effects, Facebook Direct and Facebook Stories. For the newbs out there, these three features allow Facebook users to add frames and filters to their photos, share disappearing videos with friends, and save stories that can also be shared. In other words, with one swipe of their finger, Facebook users can add visual details like a rainbow or a beard of glitter… Yes, we’re very serious. Snapchat popularized sharing of digitally decorated photographs on social media, especially among teenagers, and exposed a weakness of Facebook with the younger generation. Snap has recently emphasized its ambitions to build gadgets and has called itself a camera company rather than a social media network. Some analysts have warned that Snap is susceptible to competition from Facebook. Facebook has deals to license content from six film studios, as well as from two artists, said design director Kristen Spilman. If the rainbow, or beard glitter, wasn’t your cup of tea, another visual effect allows someone in a picture to become a laser cat with super powers. The future is now!

Tesla Inc (TSLA : US$277.33), Net Change: 7.15, % Change: 2.65%, Volume: 7,870,064 TESLA’S AIR TOXINS FILTER - WORKS GREAT WHEN YOU’RE DRIVING BEHIND A VOLKSWAGEN. Tesla said Chinese tech giant Tencent Holdings acquired a 5% stake in the company for $1.78B. The purchase, revealed in a U.S. regulatory filing, pushed Tesla's stock higher, making it the second most valuable U.S. auto company ahead of Ford Motor (F) but behind General Motors (GM). The deal gives Tencent a growing presence in the rapidly expanding future mobility sector, with investments in U.S. and Chinese startup companies that provide ride sharing services and are developing self- driving electric vehicles. It had been reported for a few months now that Tesla was in need of cash as it prepares to boost production volume and launch its new Model 3. This deal provides some much needed cushion. Tencent owns about 8.2 million shares in Tesla, making it the fifth-largest shareholder in Tesla, behind Elon Musk and investment companies Fidelity, Baillie Gifford and T. Rowe Price (TROW).

This publication is a general market commentary and does not constitute a research report. Any reference to a research report or a recommendation is not intended to represent the whole report and is not itself a research report or recommendation. This commentary is for informational purposes only and does not contain investment advice. This publication may be wholly or partially based on industry rumour, gossip and innuendo and as such is not to be relied upon as investment advice. Not intended for distribution within the United States. Canaccord Genuity Wealth Management is a division of Canaccord Corp. Member – Canadian Investor Protection Fund.

Wednesday March 29, 2017 7

COFFEE BEANS

- Japan has an obsession with expertly grown, high quality fruit. While in the U.S., most people are content to snack on mass- produced grapes, in Japan stores sell immensely flavorful and specifically farmed fruits that are often given as gifts or enjoyed as delicacies. One extreme example: the muskmelon, the most obscenely ideal specimens of which can fetch $27,000 for a pair (Slate)

- A massive was stolen from the Bode Museum in Germany on Monday. The “Big Maple Leaf” has a face value of 1 million Canadian dollars (US$750,000), but the gold it’s made of is worth about $4.5 million. Based on weight alone - this thing is 221 pounds of nearly pure gold - the theft is being investigated as a multi-person job. (ABC News)

- The Bible is the most shoplifted book in the world. (thefactsite.com)

- The average person walks the equivalent of twice around the world in a lifetime. (thefactsite.com)

- The most venomous jellyfish in the world is named the Irukandji and is smaller than your fingernail. (thefactsite.com)

- About 8,000 Americans are injured by musical instruments each year. (thefactsite.com)

- The Titanic was the first ship to use the SOS signal. (thefactsite.com)

- You cannot snore and dream at the same time. (thefactsite.com)

THE LAST DROP: “House of Cards season 5 is just going to be a live feed of C-SPAN.”

–Morgan Housel (@morganhousel)

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