The Before the Bell report is constantly updated to reflect the latest news developments and market moves in the premarket. Check back later for updates.
U.S. stock futures are pointing to solid gains on Wall Street this morning after a three-day break from trading, while early morning indicators are showing little sign that the TSX will pullback from fresh 2 1/2-year highs reached on Monday.
The Canadian dollar, meanwhile, continues under pressure, slipping well below 91 cents (U.S.) this morning ahead of the Bank of Canada's interest rate decision and monetary policy comments on Wednesday. It's trading at 90.93 cents, after hitting a low of 90.77 cents. That's the lowest level since September of 2009. Part of the pressure on the loonie this morning stems from a stronger U.S. dollar, which got a boost from a Wall Street Journal story suggesting the U.S. Federal Reserve would likely cut its monthly bond purchases by a further $10-billion (U.S.) at the end of this month.
Overseas trading today was encouraging. European stocks, as measured by the Stoxx Europe 600 Index, were up nearly a half a percentage point to a six-year high. Many Asian markets were also posting gains approaching 1 per cent. The main catalyst was a move by the People's Bank of China to provide emergency funding support for commercial banks after money-market rates jumped recently. That has eased concerns about another credit crunch ahead of the Lunar New Year, when demand for cash typically surges.
Still, it has done little to ease concerns about exploding debt levels in the country. On Monday, China revealed fourth-quarter GDP of 7.7 per cent from a year earlier, below 7.8 per cent in the third quarter - although that still managed to slightly beat expectations.
Today is another big day for U.S. corporate earnings. We detail the main names reporting below in our Stocks to Watch section. As of this morning, 16 per cent of the S&P 500 market cap have reported results so far, almost half of which have been financials. The sector has beaten on the top-line by 0.9 per cent and on the bottom-line by 0.5 per cent, according to RBC. The remaining sectors have beaten on the top-line by 0.5 per cent, but missed on the bottom-line incrementally.
Now, here's a closer look at what's going on this morning and what's to come.
MARKETS:
Equities:
Futures: S&P 500 +0.34 per cent; Dow +0.44 per cent; Nasdaq +0.52 per cent; S&P Toronto +0.06 per cent
Hong Kong's Hang Seng +0.45 per cent
Shanghai composite index +0.84 per cent
Japan's Nikkei +0.99 per cent
London's FTSE 100 +0.09 per cent
Germany's DAX +0.37 per cent
France's CAC 40 +0.35 per cent
Commodities:
WTI crude oil (Nymex Mar) +0.29 per cent at $94.64 (U.S.) a barrel
Gold (Comex Feb) -0.62 per cent at $1,244.10 (U.S.) an ounce
Copper (Comex Mar) -0.48 per cent at $3.33 (U.S.) a pound
Currencies:
Canadian dollar at 90.93 (U.S.), vs. 91.32 at Monday's North American close.
U.S. dollar index up 0.14 at 81.37
Bonds:
U.S. 10-year Treasury yield 2.86 per cent, up 0.03
ECONOMIC INDICATORS:
Statistics Canada said November wholesale sales were unchanged from October, missing the Street estimate calling for a 0.3 per cent rise. Manufacturing shipments rose 1.0 per cent during the month.
STOCKS TO WATCH:
Activist investor Dan Loeb has taken a large stake in Dow Chemical worth $1.3-billion (U.S.) and is seeking a spin-off of the company's petrochemical business. Shares are up 7 per cent in the premarket.
BlackBerry shares will again be in focus after surging 8 per cent in Toronto on Monday while the more liquid U.S. markets were closed. Investors are turning increasingly optimistic that new CEO John Chen stands a chance at turning around the company, especially after Citron, a short selling firm, said Friday that the stock was grossly undervalued.
Agrium said it expects fourth-quarter earnings to be at the "bottom" of its previously released guidance range of 80 cents (U.S.) to $1.25 per diluted share. Shares are down 3 per cent in the U.S. premarket.
Forest Laboratories shares are up 8 per cent in the premarket after swinging to a fiscal third-quarter profit and boosting its full-year earnings forecast.
Verizon reported Q4 adjusted EPS of 66 cents (U.S.) versus the Street estimate of 65 cents. Shares are up 1.3 per cent in the premarket.
Johnson & Johnson reported Q4 adjusted EPS of $1.24 (U.S.) versus Street expectations for $1.20. Shares are up 0.6 per cent in the premarket.
Delta Air Lines reported adjusted profit of 65 cents a share in its latest quarter, beating the average Street estimate of 63 cents. Shares are up 2.5 per cent in the premarket.
Other earnings today include: Advanced Micro Devices; Baker Hughes; Cree; Forest Laboratories; Halliburton; IBM; JTD Ameritrade Holding; Texas Instruments; and The Travelers Companies.
ANALYST ACTIONS:
Raymond James upgraded Lundin Mining to "outperform" from "market perform" and hiked its price target to $6.25 (Canadian) from $5.50.
RBC Dominion Securities hiked its price target on Magna International to $101 (U.S.) from $93 and maintained an "outperform" rating.
Global Hunter Securities initiated coverage on Canadian Natural Resources with a "buy" rating and $44 price target.
JPMorgan upgraded Alcoa to "overweight" from "neutral" and raised its price target to $15 (U.S.) from $9.
Cowen downgraded Target to "underperform" from "market perform" and cut its price target to $47 (U.S.) from $66.
Goldman Sachs downgraded Starbucks to "buy" from "conviction buy" and cut its price target to $86 (U.S.) from $91.
Credit Suisse raised its price target on Google to $1,450 (U.S.) from $1,200 and maintained an "outperform" rating.
Goldman Sachs upgraded Burger King Worldwide to "conviction buy" from "buy" and raised its price target to $28 (U.S.) from $25.
Sterne Agee upgraded The Gap to "buy" from "underperform" and boosted its price target to $44 (U.S.) from $38.
Sterne Agree downgraded The TJX Cos. to "neutral" from "buy" and cut its price target to $66 (U.S.) from $68.
Nomura Securities downgraded Time Warner Cable to "neutral" from "buy" and maintained a price target of $125 (U.S.).
THIS MORNING'S TOP INVESTING LINKS:
The Canadian Couch Potato blog takes a look at how to calculate your personal rate of return.
A roundup of the latest insight on market bubbles.
Uranium is a hot trade of late.
Six reasons traders fail that most traders don't think about.
Why are biotech stocks outperforming by so much?
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For instant headlines on breaking economic and corporate news in the premarket, follow Darcy Keith on Twitter at @eyeonequities.
Darcy Keith