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These are stories Report on Business is following Wednesday, Oct. 8, 2014.

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Where things stand
North American markets look to be settling down this morning – Asia and Europe, not so much – but the day is young.

On the morning after, investors are still edgy as they await this afternoon's release of the minutes of the last Federal Reserve meeting.

So far today, Asian stocks have followed yesterday's European and North American action lower, while the major exchanges in Europe remain depressed.

London's FTSE 100, Germany's DAX and the Paris CAC 40 were down by between 0.3 per cent and 0.8 per cent as North America opened.

The S&P 500, Dow Jones industrial average and Toronto's S&P/TSX composite all gained early on, but then slipped. Oil prices also fell and the Canadian dollar was relatively steady.

This coincides with the start of third-quarter financial reports, with Costco Wholesale Corp. beating projections this morning, and Alcoa Inc. to come after markets close.

Here's what analysts are saying this morning in the wake of yesterday's rout:

"Good morning. Or maybe not. The market focus is back on global equities, where the mood is darkening rapidly, with indices testing key levels and the spillover sending Treasury yields lower … The currency winners in this kind of mood are the [U.S.] dollar and the yen." Kit Juckes, Société Générale

"Positive momentum from Friday's non-farm payrolls failed to hold into the new week, and the gap between job numbers and the start of earnings season has allowed investors to, again, focus on their fear that the world economy is headed for another slump. The dramatic falls in commodity prices provide ample reason to be concerned, and if the rosy assumptions underpinning valuations come into question, the final quarter of the year could become very ugly indeed … Alcoa's earnings offer the first real beam of light for battered equity markets, with corporate news from the U.S. once again forced to step in and rescue a beleaguered equity rally. Before that, however, Fed minutes will dominate the agenda. The tense standoff between hawks and doves continues, but from the tone of recent speeches it seems that the cautious consensus on rates is looking shakier by the week." Chris Beauchamp, IG

"After receiving a bruising yesterday, U.S. markets look to open mixed with investors on edge before the Fed minutes and a number of corporate earnings reports as concern builds over slowing global growth alongside the likelihood of the Federal Reserve hiking rates in the not-too-distant future." Jasper Lawler, CMC Markets

"With the selloff over the last 24 hours now behind us, investors can look forward to the next two big events that are likely to dominate the markets in the coming weeks, the Fed and earnings season … Earnings season should provide great insight into both how companies performed in the third quarter and how confident they are in the economic recovery. For a long time, investors have focused primarily on earnings growth, regardless of how it was driven, which has enabled stocks to continue to rally even at a time when economies were not performing well and central banks were being forced to provide extraordinary support." Craig Erlam, Alpari

"Financial markets have been pricing in lower growth for several months; however the recent surge of disappointments have added to concern. Market volatility is rising, equities are weak, oil prices are at one and a half year lows, bond yields are moving back to their lows and the upward momentum for the [U.S. dollar] is fading. Falling oil prices will weigh on inflation, a particularly complex issue for the [European Central Bank] (yesterday the IMF attributed a 30-per-cent risk that Europe will fall into deflation); but will also support consumer spending in the U.S." Camilla Sutton, Bank of Nova Scotia

Accounting for cross-border shopping
Cross-border shopping may be a favourite sport for Canadians, but it apparently makes up only a small piece of the pie.

According to a Statistics Canada study released today, crossing the border to shop surged 72 per cent between 2006 and 2012, to $8-billion from $4.7-billion.

Still, the federal agency said, that accounted for just 1 per cent to 2 per cent of all Canadian retail sales.

But for 2009,  overall sales have climbed every year. In dollar terms, Canadian sales jumped to $468-billion two years ago from $389-billion in 2006.

"Comparing the two figures, cross-border shopping accounted for 1.7 per cent of total Canadian retail sales in 2012."

Of course, I'm sure Canadian retailers would have liked to hold onto that 1.7 per cent.

Starts steady
Canada's construction industry held relatively steady last month as housing starts rose "modestly" from a month earlier.

Construction starts rose to an annual pace of 197,343 from 196,283 in August, Canada Mortgage and Housing Corp. said today.

The six-month moving average, though, was stronger, at 197,747, compared to 191,095.

"The increase in the trend reflects stronger starts activity since April, largely concentrated in multi-unit dwellings including condominiums," said Bob Dugan, the agency's chief economist.

"However, the currently elevated level of condominium units under construction supports our view that condominium starts should trend lower over the coming months."

Siri, how's my driving?
The American Automobile Association is warning that hands-free technology may not be as safe behind the wheel as you may think.

Research from the U.S. driving group suggests "developers can improve the safety of their products by making them less complicated, more accurate and generally easier to use," the AAA says, adding it plans to work with auto makers to produce better systems.

According to the AAA, University of Utah tests, which included heart-rate monitors and "instrumented" test cars, found, among other things, that the accuracy of such software "significantly influences the rate of distraction."

Updating earlier research, they used a five-point ranking system like the one for hurricanes, and found that the accuracy issue was a "high" level of 3 where distraction is concerned.

Also a 3 was in-car composition of text messages and e-mails. Listening to them, in turn, was a category 2.

Quality of the systems was also an issue: Listening to a "natural or synthetic voice" each came in as a category 2.

"We already know that drivers can miss stop signs, pedestrians and other cars while using voice technologies because their minds are not fully focused on the road ahead," AAA chief executive officer Bob Darbelnet said in the group's statement.

"We now understand that current shortcomings in these products, intended as safety features, may unintentionally cause greater levels of cognitive distraction."

Researchers also looked specifically at Siri, that genius on Apple Inc. devices, using the tech giant's own insight on the iOS 7 version.

"Researchers used the same metrics to measure a broader range of tasks including using social media, sending texts and updating calendars. The research uncovered that hands- and eyes-free use of Apple's Siri generated a relatively high category 4 level of mental distraction."

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Tickers mentioned in this story

Study and track financial data on any traded entity: click to open the full quote page. Data updated as of 28/03/24 2:06pm EDT.

SymbolName% changeLast
AA-N
Alcoa Corp
+1.36%33.66
AAPL-Q
Apple Inc
-0.96%171.64
BNS-N
Bank of Nova Scotia
+1.39%51.87
BNS-T
Bank of Nova Scotia
+1.09%70.18
CADUSD-FX
Canadian Dollar/U.S. Dollar
+0.24%0.73882
COST-Q
Costco Wholesale
-0.28%730

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