Colin Cieszynski
The Before the Bell report is compiled by editors of The Globe and Mail and is updated throughout the morning to reflect latest developments. Colin Cieszynski, Chartered Financial Analyst and Chartered Market Technician, is chief market strategist with CMC Markets.
There hasn't been much in the way of economic news overnight, and because of this, trading has continued to be dominated by shifting expectations of the Fed's next moves and falling energy prices that dominated Wednesday's trading.
This morning finds Germany's Dax down about 1.5 per cent, U.S. index futures for the Dow and S&P 500 down about 0.5 per cent, and London's FTSE running in the middle, down about 1.0 per cent. The British pound has been the strongest currency so far today, even outperforming the advancing U.S. dollar, boosted by better-than-expected U.K. retail sales excluding autos and some short covering ahead of the weekend. Traders may be recognizing Brexit uncertainty - the possibility that Britain will withdraw from the European Union - may have been overplayed this week.
The U.S. dollar remains on the rebound today as Fed speakers continue to backtrack away from what had appeared to be a dovish signal in its policy statement and projections last week. Several Fed speakers since the meeting, including Chair Janet Yellen, have suggested April as a "live" meeting, where a rate hike will seriously be considered.
Most of these speakers were non-voters and not taken seriously. But this changed Wednesday when St. Louis Fed President James Bullard, a swing voter this year who had favoured the December liftoff, then switched to the dovish camp in January when oil fell and deflation fears rose, swung into the hawkish camp. He indicated that if data remain strong the Fed should consider an April rate hike given the risk of the Fed falling behind the inflation curve. He also indicated he thinks the Fed should have press conferences after every meeting to make them all equal and do away with member forecasts, particularly the "dot plot" which offers projections on future rate moves. He is speaking again this morning, giving him another chance to make the hawkish case.
Crude oil has been hammered again overnight following Wednesday's big increase in Department of Energy inventories, which confirmed the big American Petroleum Institute increase, indicating that U.S. production still isn't falling fast enough with demand soft as well. The Canadian dollar is down 0.3 per cent versus the U.S. dollar. Gold has stabilized near $1,215 (U.S.) per ounce after selling off Wednesday. Today natural gas inventories and the U.S. Baker Hughes drill rig count could influence sentiment in the energy sector.
U.S. data this morning on durable goods and weekly jobless claims came in close to expectations. On Friday, the second revision to U.S. fourth-quarter GDP is being released despite markets being closed for the holiday, and the number isn't expected to change.
Now, here is a closer look at key market data, as well as the main corporate and economic news of the morning.
MARKET DATA:
Futures
Dow -0.41 per cent; S&P 500 +0.18 per cent; Nasdaq: -0.76 per cent; TSX 60 -0.61 per cent
Equities
Japan's Nikkei 225 -0.64 per cent
Shanghai composite index -1.62 per cent
Hong Kong's Hang Seng -1.31 per cent
Germany's DAX -1.36 per cent
London's FTSE -1.33 per cent
France's CAC 40 -1.80 per cent
Commodities
WTI crude oil (Nymex May) -2.41 per cent at $38.84 (U.S.) a barrel
Gold (Comex April) -0.40 per cent at $1,219.10 (U.S.) an ounce
Copper (Comex May) -0.78 per cent at $2.218 (U.S.) a pound
Currencies
Canadian dollar -0.0027 at 75.41 cents (U.S.)
U.S. dollar index +0.123 at 96.169
Bonds
U.S. 10-year Treasury yield -0.0085 at 1.87 per cent
KEY ECONOMIC RELEASES
U.S. initial jobless claims for the week ended March 19 came in at 265,000, close to expectations of 268,000 claims.
U.S. durable goods orders for February fell 2.8 per cent, close to expectations of 3.0 per cent.
KEY CORPORATE NEWS
Eldorado Gold Corp.has swung to a big loss in the fourth quarter and for the year as a whole, citing huge impairment charges totalling more than $1.5 billion in 2015. The company also suspended its semi-annual dividend.
Yahoo's stock rose 1 per cent before the opening bell on a report that an activist shareholder will launch a campaign to replace its entire board. The Wall Street Journal reported Thursday that Starboard Value LP will nominate nine people to Yahoo's board.
Earnings include: Accenture PLC; Alamos Gold Inc.; Excellon Resources Inc.; Knight Therapeutics Inc.; Spin Master Corp.
Also see: Thursday's small-cap stocks to watch
With files from wire services