BUSINESS REPORT – Canadian banks could set the tone for equity markets going into Fall

RBC tops Indeed's list of the top 25 places to work in Canada.
RBC tops Indeed's list of the top 25 places to work in Canada. Ben Nelms/Bloomberg via Getty Images

RBC is the first Canadian Bank to report this quarter, with a five per cent gain in net income over the same period last year.

With stellar earnings this quarter, Canadian banks can lead the TSX higher going into Fall, which is a good barometer as to the health of the Canadian economy.

Royal Bank is reporting net income of $2.8-billion and earnings per share of $1.89, two cents above estimates of $1.87.

And for shareholders, the bank raised the quarterly dividend by five per cent to 91 cents per share.

READ MORE: Royal Bank to slash 450 jobs, majority at head offices in Toronto-area

In what has been a flat stock market so far this year, the banks have once again outperformed, and with GDP growth set to continue expansion and another interest rate hike expected from the Bank of Canada, both measures will increase Canadian banks’ ability to earn above expectations.

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CIBC reports Thursday morning with the rest of the banks reporting next week.