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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.

Major indexes have been trading pretty much flat overnight and into this morning with traders still looking for something to give them direction. U.S. index futures are up slightly while the DAX, gold and West Texas Intermediate crude oil are all down slightly. The U.S. dollar is steady or up slightly with Japanese yen underperforming again.

Technology stocks could attract a lot of attention following last night's earnings reports. Amazon missed badly on earnings blaming higher shipping costs. Sales guidance was on the soft side even though the company indicated it plans to increase seasonal hiring by 20 per cent to 120,000. Amazon dragged on the Nasdaq in aftermarket trading and may remain under pressure today. Google beat the street on earnings while sales were pretty much as expected. It remains to be seen if that will be enough to offset the Amazon disappointment. LinkedIn had a really good report but the impact is unclear as the company is being acquired. However, the positive report could ease fears over whether Microsoft is overpaying for the business social network or not.

In economic news, the U.S. economy grew at its fastest pace in two years in the third quarter as a surge in exports and a rebound in inventory investment offset a slowdown in consumer spending. Gross domestic product increased at a 2.9-per-cent annual rate after expanding at a 1.4-per-cent pace in the second quarter, the Commerce Department said on Friday in its first estimate. That was the strongest growth rate since the third quarter of 2014. Economists polled by Reuters had forecast GDP rising at a 2.5-per-cent annual rate in the third quarter.

This could have a bigger impact on politics than the market. It would be unlikely that this report changes the U.S. Federal Reserve's drive toward a December rate hike. Politicians may, however, seize on the report to bolster their assessment of the state of America's economy and to pass judgement on President Barack Obama's economic policies. A big number could help the Democrats, a poor result could support the Republicans.

Now, here is a closer look at what's going on this morning and what is still to come.

MARKET DATA:

Futures (as of about 8:30 a.m. ET)

Dow +0.12 per cent; S&P 500 +0.13 per cent; Nasdaq: +0.20 per cent; TSX 60 +0.18 per cent

Equities
Japan's Nikkei +0.63 per cent
Shanghai composite index -0.23 per cent
Hong Kong's Hang Seng -0.77 per cent 
Germany's DAX -0.27 per cent
London's FTSE +0.04 per cent
France's CAC 40 +0.35 per cent

Commodities
WTI crude oil (Nymex Dec.) -0.78 per cent at $49.33 (U.S.) a barrel
Gold (Comex Dec.) -0.18 per cent at $1,267.20 (U.S.) an ounce
Copper (Comex Dec.) +0.42 per cent at $2.17 (U.S.) a pound

Currencies
Canadian dollar +0.03 at 74.66 cents (U.S.)
U.S. dollar index -0.04 at 98.85

Bonds
Canada 10-year bond yield -0.2589 at 1.23 per cent

KEY ECONOMIC RELEASES

China CPI, jobless rate and household spending
Euro Area economic and consumer confidence
Germany CPI

(8:30 a.m. ET) U.S. real GDP and GDP deflator for Q3 (A). The consensus estimates are annualized rate increases of 2.5 per cent and 1.3 per cent, respectively.

Gross domestic product increased at a 2.9 percent annual rate after expanding at a 1.4 percent pace in the second quarter, the Commerce Department said on Friday in its first estimate.


(8:30 a.m. ET) U.S. employment cost index for Q3 (A). Consensus is an increase of 0.6 per cent from Q2 and 2.3 per cent year over year.

U.S. labour costs maintained a steady pace of increase in the third quarter, showing little signs of a significant pickup in wage inflation. The Employment Cost Index, the broadest measure of labor costs, increased 0.6 percent after a similar gain in the second quarter, the Labor Department said on Friday. That left the year-on-year rate of increase at 2.3 percent. Economists polled by Reuters had forecast the ECI rising 0.6 percent in the third quarter.


(10 a.m. ET) U.S. University of Michigan Consumer Sentiment. Consensus is 88.2, down from 91.2 in September.
(1 p.m. ET) Baker-Hughes rig count

Also: Canada budget balance for August

KEY STOCKS TO WATCH

**

Bank of Montreal has shuffled some of its top executives in a move ostensibly designed to position the lender for additional growth, but raises the possibility that the bank is also getting ready for a transition in its top leadership. Darryl White, currently group head of capital markets and widely seen as a strong candidate to become chief executive officer of BMO, has been appointed chief operating officer. The change comes as Bill Downe – who has been BMO's CEO since 2007, is expected to step down from the role shortly.

**

Amazon.com shares are on track to open at a more than two month low, falling 4.4 percent at $782.50 after the online retailer warned that heavy investment would drag on profits in the holiday quarter.

**

Google parent Alphabet was up 1.2 percent to $827 after the company's third-quarter revenue and profit beat analysts' expectations.

**

Drug distributor McKesson plunged 13.1 to $139.50 percent, taking down peer Cardinal Health, after reporting a revenue in the second quarter that missed expectations.

**

Baker Hughes rose 6.8 percent to $58.26 after GE said it was in discussion with the oilfield services provider on potential partnerships.

**

Expedia missed estimates by six cents a share, with adjusted quarterly profit of $2.41 per share. But revenue was essentially in line with forecasts. Its shares were up 1.3 per cent in premarket trading.

**

Hershey beat estimates by 11 cents a share, with quarterly profit of $1.29 per share. Revenue also beat forecasts. Its shares were up 1.6 per cent in premarket trading.

**

UBS saw profit for its latest quarter come in below estimates, but the Switzerland-based bank also increased reserves for potential U.S. penalties related to its sales of mortgage-backed securities. UBS maintained a downbeat outlook amid negative interest rates in its home country. Its shares were up 2.2 per cent in premarket trading.

**

Brewer Ab InBev cut its full-year guidance, with a fourth straight quarterly decline in Brazilian beer sales a key factor. Brazil is the company's second largest market.

**

Drug maker Amgen beat estimates on both the top and bottom lines in its latest quarterly earnings report, with the biotech giant raising its full-year forecast, as well. Its shares were down 4.7 per cent in premarket trading.

**

The Canadian arm of SunEdison Inc., at one time one of the biggest and most successful solar panel installers in Canada, has filed for bankruptcy protection. SunEdison's Canadian operations remained functioning after the parent company filed for Chapter 11 protection in the United States in April, but now the Canadian group has also filed, under Canada's Companies' Creditors Arrangement Act.

**

What looked like it could become a brawl over sports equipment manufacturer Performance Sports Group Ltd. has taken a friendly turn. Shareholder Brookfield Capital Partners Ltd. has entered into a confidentiality agreement with PSG's largest investor, Sagard Capital Partners LP, the U.S. investment firm controlled by the Desmarais family's Power Corp., the two companies announced Thursday in a filing with the U.S. Securities and Exchange Commission. They said they could act together on potential proposals, including a possible restructuring of PSG, equity issuance or debt refinancing.

**

Goodyear Tire & Rubber Co., the largest U.S. tire maker, reported an 8.1 percent fall in quarterly revenue on Friday as it shipped fewer tires in the Americas region, its biggest market. The company said net income available to its shareholders rose to $317 million, or $1.19 per share, in the third quarter ended Sept. 30, from $271 million, or 99 cents per share, a year earlier. Revenue fell to $3.85 billion from $4.18 billion. Its shares fell 6.7 per cent in premarket trading.

**

MasterCard reported earnings of $1.08 a share for the third quarter, much higher than the Street estimate of 98 cents per share on revenue of $2.79-billion. Its shares rose 1.7 per cent in premarket trading.

**

Imperial Oil Ltd., Canada's No.2 integrated oil producer and refiner, said its quarterly profit more than doubled due to a $716-million gain from the sale of some of its retail sites. The company, 69.6 percent owned by Exxon Mobil Corp, said net income shot up to $1-billion, or $1.18 per share, in the third quarter, from $479 million, or 56 cents per share, a year earlier. Total revenue and other income rose 4 percent to $7.44 billion.

**

Exxon Mobil Corp., the world's largest publicly traded oil company, said on Friday its quarterly profit fell by $1.59 billion due to declining crude prices and refining margins. The company reported third-quarter net income of $2.65 billion, or 63 cents per share, compared with $4.24 billion, or $1.01 per share, a year earlier. The results topped Wall Street expectations of 60 cents per share. But its shares fell 1.1 per cent in premarket trading.

Also see: Friday's small-cap stocks to watch

Earnings include: AbbVie Inc.; Aon PLC;Apollo Global Management LLC; Audi AG; AutoNation Inc.; Cabot Oil & Gas Corp.; CBOE Holdings Inc.; Chevron Corp.; Colliers International Group Inc.; Dundee Energy Ltd.; Exelon Corp.; Exxon Mobil Corp.; Fortive Corp.; Hershey Co.; Imperial Oil Ltd.; Legg Mason Inc.; MacDonald Dettwiler and Associates Ltd.; MasterCard Inc.; Mylan NV; Newell Brands Inc.; Norbord Inc.; Phillips 66; Teranga Gold Corp.; Total SA; TransAlta Renewables Inc.; Ventas Inc.; Weyerhaeuser Co.; Xerox Corp.

With files from wire services, CNBC.com

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