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.
Asia Pacific markets provided a strong start to the week with a catch-up rally. The Hang Seng rose 0.95 per cent while the Nikkei gained 0.3 per cent. Initial enthusiasm has faded as the day has progressed. European markets are mixed with the FTSE up 0.1 per cent and the Dax down 0.4 per cent while U.S. index futures are flat.
As is normal after nonfarm payrolls, U.S. news flow goes quiet for a few days. There are still some earnings reports of interest. Toymaker Hasbro has posted stellar earnings this morning and a 10-per-cent-plus dividend increase.
There are a number of things simmering away in the background that could move the markets but it's hard to say how much or when at this point. For example, sterling is steady sitting on $1.2500 as three days of debate on the Brexit bill gets underway in the U.K. House of Commons. In Europe, Germany is blaming the European Central Bank for the low euro following verbal barbs from U.S. President Donald Trump last week with ECB President Mario Draghi speaking today. Polls in France and Germany showing opposition parties gaining ground and an International Monetary Fund report on Greece's debt may also attract some attention.
Tensions between the U.S. and Iran remain elevated following Iran's recent missile test. WTI crude is up 0.35 per cent while gold is up 0.65 per cent.
So there's potential for action, but it's not clear where the main focus may fall. There are also a number of round number tests to keep an eye on including 20,000 for the Dow, $1.3000 for U.S. dollar to Canadian dollar, par for the U.S. dollar to the Swiss Frac, $1.2500 for British pound to U.S. dollar, and others.
Now, here is a closer look at key market data, and corporate and economic news.
MARKET DATA:
Futures (as of about 7:30 a.m. ET)
Dow +0.01 per cent; S&P 500 -0.01 per cent; Nasdaq: -0.03 per cent; TSX 60 -0.05 per cent
Equities
Japan's Nikkei +0.31 per cent
Shanghai composite index 0.55 per cent
Hong Kong's Hang Seng +0.95 per cent
Germany's DAX -0.38 per cent
London's FTSE +0.13 per cent
France's CAC 40 -0.09 per cent
Commodities
WTI crude oil (Nymex March) +0.35 per cent at $54.02 (U.S.) a barrel
Gold (Comex April) +0.65 per cent at $1,228.70 (U.S.) an ounce
Copper (Comex March) +0.67 per cent at $2.63 (U.S.) a pound
Currencies
Canadian dollar -0.06 at 76.74 cents (U.S.)
U.S. dollar index +0.01 at 101.19
Bonds
Canada 10-year bond yield +0.26 at 1.73 per cent
KEY ECONOMIC RELEASES
China Caixin PMI and foreign reserves
Euro Area retail PMI
Germany factory orders
(10 a.m. ET) U.S. Federal Reserve Labor Market Conditions Index for January.
KEY STOCKS TO WATCH
Also see: Monday's small-cap stocks to watch
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Tiffany fell 4.9 percent to $75 in premarket trading as it said its CEO has stepped down after what the company called disappointing financial results. Tiffany announced that CEO Frederic Cumenal is stepping down and is being replaced by chairman Michael Kowalski, who had preceded Mr. Cumenal as CEO.
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Hasbro rose 11.1 percent to $86 after the toymaker reported a rise in quarterly profit.
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Chipotle Mexican Grill was down 1.86 percent at $399.73 after Barron's said the burrito chain's stock could fall as much as 35 percent in the next year.
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Sunshine Silver Mining & Refining Corp. is auditioning investment banks for starring roles in an IPO on the Toronto Stock Exchange, according to sources pitching the company. The Denver-based firm filed to go public in 2011, with plans to raise $250-million, but could not complete the financing.
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Tyson Foods Inc., the biggest U.S. meat processor, reported a 28.6 percent rise in quarterly profit, helped by higher exports of beef and pork and lower livestock costs. Tyson's shares were off 0.2 in premarket trading. Tyson Foods earned $1.59 per share for its latest quarter, above estimates of $1.26 a share. Revenue also beat Street forecasts. It also raised its full-year forecast above current consensus estimates.
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Ithaca Energy Inc.'s board is recommending that its shareholders accept a friendly takeover bid from Delek Group Ltd., which is offering to pay C$681 million cash to buy all the Ithaca stock it doesn't already own. Ithaca's main focus is on North Sea oil and gas. Delek, which is developing natural gas reserves in the eastern Mediterranean Sea, already owns 19.7 per cent of Ithaca.
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Newell Brands earned an adjusted 80 cents per share for its latest quarter, matching Street forecasts. Revenue was below forecasts, however. Its shares were down 3 per cent in premarket trading.
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Toyota raised its full-year profit outlook by nearly 10 percent, with a weaker yen a major contributor to the automaker's improved outlook.
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JPMorgan Chase received a license to underwrite corporate bonds in China, becoming the first U.S.-based bank to be granted such a license. Its shares were down 0.44 per cent in premarket trading.
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Medical lab operator Laboratory Corp. is in talks to acquire privately held contract researcher Pharmaceutical Product Development for more than $8-billion, according to a Reuters report. PPD was taken private in 2011 for $3.9 billion.
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CBS was upgraded to "overweight" from "neutral" at Atlantic Equities, which also increased its target price to $78 from $61.
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TrueCar was upgraded to "outperform" from "sector perform" at RBC Capital, which cites the car buying service's fundamentals and valuation, among other factors.
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Fed Ex was upgraded to "outperform" from "market perform" at Raymond James, which has a price target of $210 compared to the current price of $188.21.
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Earnings include: Absolute Software Corp.; Alacer Gold Corp.; Clairvest Group Inc.; CNA Financial Corp.; Creditcorp Ltd.; FMC Corp.; Hasbro Inc.; Loews Corp.; Macerich Co.; Newell Brands Inc.; Sysco Corp.; Tesoro Corp.; Toromont Industries Ltd.; Twenty-First Century Fox Inc.; Tyson Foods Inc.
With files from wire services