Ben Bernanke and U.S. corporate earnings will take the spotlight for a second day, as traders await more insight on the direction of U.S. monetary policy and the health of the balance sheets of some of the largest blue chip companies.
The Federal Reserve chairman will be testifying for a second day in front of Congress, and investors will be watching carefully to see if he makes any shifts away from his rather dovish comments on Wednesday, when he suggested the tapering of bond purchases will be closely tied to economic conditions.
Key to determining how well the economy is faring will be the health of the nation's employment levels. U.S. initial jobless claims for last week, released this morning, suggested the jobs market is definitely showing progress, with new claims falling to their lowest level in two months.
On the earnings front, some 32 stocks in the S&P 500 are reporting results today. So far, second-quarter results have been close to how the first-quarter turned out, with 71 per cent topping analysts' profit estimates but only 57 per cent beating on sales, according to Bloomberg data.
Markets aren't doing much so far this morning, although U.S. stock futures ticked a little higher after the stronger-than-expected U.S. jobless claims figures were released. The Japanese market was a bright spot overnight, with the Nikkei rallying 1.3 per cent as the yen slid about 0.5 per cent against the U.S. dollar to 100.09 (U.S.). Aiding the yen's move was comments from Russian Deputy Finance Minister Sergei Storchak, who said G-20 members, who meet this weekend, are unlikely to call for a tapering of stimulus in nations including Japan.
Now, here's a closer look at what's going on and what's to come later today.
Futures: S&P 500 +0.10 per cent; Dow +0.03 per cent; Nasdaq -0.08 per cent; TSX Toronto +0.29 per cent
Hong Kong's Hang Seng -0.13 per cent
Shanghai composite index -1.07 per cent
Japan's Nikkei +1.33 per cent
London’s FTSE 100 +0.43 per cent
Germany’s DAX +0.06 per cent
France's CAC 40 +0.21 per cent
WTI crude oil (Nymex Sep) +0.1 per cent at $106.50 (U.S.) a barrel
Gold (Comex Aug) +0.2 per cent at $1,282.20 (U.S.) an ounce
Copper (Comex Sep) -0.1 per cent at $3.13 (U.S.) a pound
Canadian dollar at 96.04 (U.S.), versus 96.02 at Wednesday's North American close.
U.S. dollar index up 0.05 at 82.76
U.S. 10-year Treasury yield 2.49 per cent, down 0.04
ECONOMIC INDICATORS TO WATCH:
U.S. initial jobless claims last week fell 24,000 to 334,000, the lowest level in two months. Economists expected 344,000 new claims.
Canada wholesale trade surged 2.3 per cent in May from April, much stronger than the 0.3 per cent rise expected by economists and the fastest rate in more than two years. .
(10 a.m. ET) The U.S. releases the Philadelphia Fed Survey for July, with the general business conditions index forecast to decline to 9.0 from 12.5 in June.
(1030 a.m. ET) Fed Chairman Ben Bernanke discussing economic outlook and Fed interest rate policy with the Senate Banking Committee.
STOCKS TO WATCH:
Shoppers Drug Mart reported second-quarter earnings of 73 cents per share, one cent above a consensus estimate and up 5.8 per cent from year-earlier. It also said it will pay a dividend of 28.5 cents per share in October.
Morgan Stanley reported second-quarter earnings of 45 cents a share, beating Street estimates of 43 cents. Revenue of $8.33-billion also beat the estimate of $7.89-billion. Shares are up 4 per cent in the premarket.
Verizon Communications Inc. reported adjusted per-share profit of 73 cents on revenues of $29.79-billion. Analysts expected earnings of 72 cents on revenue of $29.81-billion. Shares are down 0.5 per cent in the premarket.
EBay Inc. shares are down 6.6 per cent in the premarket after it met analysts' expectations for quarterly profit but provided a third-quarter outlook that fell short of their forecasts.
Yahoo Inc. shares are down 0.3 per cent in the premarket after surging 10 per cent on Wednesday, as growth in its Alibaba unit exceeded expectations.
Intel Corp. shares are down 3.6 per cent in the premarket after the chip maker lowered its full-year guidance late Wednesday and made cuts to its capital spending plans.
Nokia Corp.'s ADS shares in the premarket are down 4.2 per cent after the company reported better-than-expected earnings in the second quarter but said sales dropped 24 per cent, worse than the Street had anticipated.
Philip Morris International Inc. said its second-quarter profit was $1.30, missing the Street view of $1.41. The company also lowered its full-year guidance. Shares are down 1.9 per cent in the premarket.
Other earnings today include: Advanced Micro Devices Inc.; BlackRock Inc.; Capital One Financial Corp.; Chipotle Mexican Grill Inc.; Ericsson ADR; Google Inc.; Microsoft Corp.; Union Pacific Corp.; and Safeway Inc.
Great-West Lifeco Inc. completed the $1.75-billion acquisition of Irish Life.
THIS MORNING'S TOP INVESTING READS ON THE WEB:
Legendary hedge fund manager John Paulson remains undaunted by the huge plunge in gold, maintaining that the case for owning the yellow metal remains strong.
A market timing indicator with a stellar long-term record is now in “sell” mode.
Why the real threat to gold is bitcoin - or something similar.
Short-seller James Chanos is betting against Caterpillar Inc., believing it's tied to the wrong products at the wrong time.
Five emerging markets that are tempting buys right now.
Your hand will likely be the remote for the new and long-awaited Apple TV.
How eight U.S.-listed exchange-traded funds separated themselves from their broad markets by vastly outperforming.
Fund flows suggest a lot of the money recently existing bond funds didn't go to equities - but rather banks. And that means the bond outlook may not be all that bad.
The premarket report is constantly updated to reflect the latest news developments and market moves. For instant headlines on breaking economic and corporate news in the premarket, follow Darcy Keith on Twitter at @eyeonequities. You can also be notified using our dashboard feature when new articles appear from this author. Read more on using this feature here.