Investors haven't regained much appetite for stocks despite two straight days of hefty post-U.S. election declines. North American markets have opened flat to mildly lower, with the looming "fiscal cliff" continuing to spook would-be buyers.
In early trading, the S&P 500 index was down 1 point, or 0.08 per cent, at 1,3776; the Dow Jones industrial average was down 29 points, or 0.2 per cent, at 12,781; and the S&P/TSX index was down 6 points, or 0.05 per cent, at 12,185.
The reelection of President Barack Obama and a divided Congress Tuesday turned the focus to the "fiscal cliff" -- the combination of more than $600-billion in tax increases and spending cuts scheduled to kick in Jan. 1 unless Washington can reach a deficit-reduction agreement. Failure to reach a deal would likely plunge the U.S. economy back into recession, surely sending stocks into a freefall.
The odds are good that the fiscal cliff will be averted, but the political wrangling that may be involved is setting the market up for more volatility and is acting as yet another distraction for getting the U.S. economy back to faster growth. Mr. Obama is likely to discuss the issue at a speech scheduled for 1:05 p.m. (ET) today.
China overnight released several reports suggesting the economy there is picking up its pace. Industrial production rose 9.6 per cent in October from a year earlier, a little better than most economists had been expecting. Retail sales climbed 14.5 per cent last month from a year earlier, also slightly exceeding forecasts. There was also a further dip in the inflation rate.
Still, markets are being cautious in reacting to the data. Commodities tell the tale: copper is down 1.4 per cent in New York this morning and crude oil is down 30 cents, or 0.15 per cent, at $84.79.
Europe, of course, remains a focus. On Sunday, a parliamentary vote will take place in Greece on the country's 2013 budget, and euro zone finance ministers are meeting Monday. It's unclear whether they will move to allow the release of the $40-billion in aid for Greece. At least one official has hinted a decision won't be made until late November.
There was some positive news on the U.S. consumer confidence front this morning. The Reuters/University of Michigan reading for November came in at 84.9, versus the consensus expecting of 83.3 and modestly higher than last month.
There are a number of corporate developments this morning. Here's a rundown of them:
Telus Corp. boosted its quarterly dividend after reporting a third-quarter profit that rose 7.7 per cent from a year ago to $351-million. Shares are up 1.1 per cent at the open.
TMX Group Ltd. issued its first financial report since undergoing a strategic reorganization. Earnings were $15.3-million in the most recent quarter. It also announced plans to eliminate 100 positions over the next 12 months.
Rona's CEO, Robert Dutton, is stepping down. Shares are up 6 per cent at the open.
Groupon Inc. shares are down 23 per cent after its quarterly earnings once again fell short of Wall Street's already-cautious expectations. It's also cutting jobs.
Walt Disney Co. shares are down 6 per cent after its quarterly revenues missed expectations, although net income matched analysts' forecasts.
Kayak Software Corp. shares are up 27 per cent after Priceline.com announced a deal late Thursday to acquire the company.
J.C. Penney Co. narrowed losses in its fiscal third-quarter but not as much as the Street was hoping for.
Other earnings out today include: Brookfield Asset Management Inc.; Canadian REIT; Emera Inc.; Enerplus Corp.; GMP Capital Inc.; Héroux-Devtek Inc.; Ivanhoe Energy Inc.; and Stella-Jones Inc.