(Updated with the latest economic and corporate news)
With the U.S. presidential election just one day away, traders are shunning risk this morning. U.S. stock index futures are flat, and commodities are relatively subdued too, pointing to a rather indecisive start to the North American trading day.
The race for the White House is expected to be a nail-biter, since President Barack Obama and Republican challenger Mitt Romney are virtually neck-and-neck in polls.
Most market observers think equities would rally if Mr. Romney wins the top office, given perceptions of a more pro-business and capitalist agenda. There are also concerns that an Obama victory would probably bring along with it a Congress split between Republicans and Democrats, making it tougher to avoid the "fiscal cliff" scenario. The term refers to the tax rises and spending cuts that are due to be enacted at the end of this year, considered a major threat to the U.S. economy.
Indeed, despite some early tepid gains on Friday after the upbeat U.S. jobs report, both the TSX and Dow closed last week with triple-digit losses as worries mounted over the election.
Markets overnight were lower in both Asia and Europe. There is concern in Europe about an austerity vote in Greece on Wednesday on unpopular cost cuts and tax hikes that the European Central Bank and others want passed before they hand out more aid. Meanwhile, Europe's largest bank, HSBC, overnight reported quarterly profits that missed analysts' forecasts, not exactly lifting spirits.
Now, here's the rundown of what else you need to know before the trading day begins:
Futures: Dow unchanged, S&P 500 -0.1 per cent, Nasdaq +0.1 per cent
Hong Kong's Hang Seng index -0.48 per cent
Shanghai composite index -0.14 per cent
Japan’s Nikkei -0.49 per cent
London’s FTSE 100 -0.64 per cent
Germany’s DAX -0.60 per cent
France's CAC 40 -0.93 per cent
WTI (Nymex Dec) +0.01 per cent at $84.87 (U.S.) a barrel
Gold (Comex Dec) +0.24 per cent at $1,679.30 (U.S.) an ounce
Copper (Comex Dec) -0.78 per cent at $3.45 (U.S.) a pound
Canadian dollar down 0.0011, or 0.1 per cent, at 1.0033 (U.S.)
STOCKS AND ECONOMIC INDICATORS TO WATCH:
Statistics Canada said building permits fell 13.2 per cent in September from August, a much steeper decline than the 2.8 per cent economists had forecast. But much of that was driven by losses in the non-residential sector. Residential housing permits actually rose by 0.4 per cent after two months of declines.
(1000 a.m.) The U.S. Institute for Supply Management publishes its services index for October. Economists expect a reading of 54.5.
Apple said it sold 3 million iPad minis and iPad 4s since Friday, when the mini was launched. It did not further break out the sales figures. Apple shares are up about 1.5 per cent in the premarket.
Time Warner Cable said third-quarter earnings more than doubled thanks to strong revenue gains in its high-speed data segment, but it was less than the Street was expecting. Shares are down 6 per cent in the premarket.
Netflix has adopted a shareholder rights plan to combat Carl Icahn's attempt to snap up a big stake in the company.
Earnings include: Absolute Software Corp.; Aecon Group Inc.; Dundee International REIT; Indigo Books and Music Inc.; MacDonald Dettwiler and Associates Inc.; MDC Partners Inc.; Nissan Motor Co. Ltd.; Silver Wheaton Corp.; Toyota Motor Corp.; Uranium One Inc.
THIS MORNING'S TOP INVESTING READS ON THE WEB:
Mutual fund giant Vanguard Group has ruffled a lot of feathers with a new paper suggesting that investing a lump sum of money in stocks pays off better than the often recommended strategy of dollar-cost averaging.
Why the returns of the S&P-500 are thrashing those of hedge funds.
Microsoft Corp. is working with component suppliers in Asia to test its own smartphone design, suggesting the computer-software giant is increasingly adopting a variation of a business model favoured by rival Apple Inc.
Companies have been hoarding cash on their balance sheets not just in North America, but all over the world. It's a trend that started before the financial crisis and, as the Economist points out, companies are unlikely to abandon their frugal ways anytime soon.
Capital Economics suggests Asia could be heading for a new major debt crisis. It says it has the charts to prove it, too.
Something Canadian investors must consider, perhaps even more than Americans: the dangers of a home-country bias.
For instant headlines on breaking economic and corporate news in the premarket, follow Darcy Keith on Twitter at @eyeonequities