The Before the Bell report is constantly updated to reflect the latest news developments and market moves in the premarket. Check back later for updates.
Gold and silver futures are sinking again this morning, as precious metals continue to fall out of favour amid easing political frictions with Syria and speculation that the U.S. Federal Reserve will start scaling back its stimulus measures next week.
Gold futures are down about 0.9 per cent and silver 1.3 per cent - both off their lows from earlier this morning as the U.S dollar turned lower against major currencies just ahead of the opening bell.
Crude oil and copper are also tracking lower - all of which should translate into more losses for the TSX materials sector today.
So far this week, gold is down more than 6 per cent, its weakest performance since June, while silver is heading for its biggest weekly drop since April. Gold, which can benefit when investors look for safety at times of geopolitical uncertainty, got bid up last week as it looked increasingly likely the U.S. would launch military strikes against Syria. But prices have faded as diplomatic efforts have ramped up with the aid of Russia.
Markets also seem to getting increasingly confident that the Fed will start tapering its bond purchases after it meets next Tuesday and Wednesday. According to the most recent Bloomberg survey, economists - on average - think the Fed will cut monthly purchases of Treasuries to $35-billion from $45-billion and keep mortgage bond buying at $40-billion. Quantitative easing is considered positive for gold, given risks that it could stoke inflation.
The release of U.S. economic reports this morning are drawing attention, but so far haven't had a major impact on stock futures, which are unchanged to slightly higher. Retail sales came in modestly below expectations, while producer prices rose a touch higher than forecasts.
The U.S. dollar got a slight pop earlier this morning after a report from Japanese newspaper Nikkei circulated that said President Barack Obama will appoint former U.S. Treasury Secretary Lawrence Summers as the next chairman of the Fed. Mr. Summers is considered more hawkish than the other leading candidate, Fed Vice Chairman Jenet Yellen, and the threat of higher interest rates is supportive of the U.S. dollar. However, some market participants are expressing doubt over the accuracy of the Nikkei report, and the White House is denying that a decision has been reached.
Now, here's a closer look at what's going on this morning and what's to come.
MARKETS:
Equities:
Futures: S&P 500 +0.03 per cent; Dow +0.12 per cent; Nasdaq +0.15 per cent
Hong Kong's Hang Seng -0.17 per cent
Shanghai composite index -0.87 per cent
Japan's Nikkei +0.12 per cent
London's FTSE 100 -0.21 per cent
Germany's DAX +0.11 per cent
France's CAC 40 -0.04 per cent
Commodities:
WTI crude oil (Nymex Oct) -0.58 per cent at $107.96 (U.S.) a barrel
Gold (Comex Dec) -0.89 per cent at $1,312.90 (U.S.) an ounce
Silver (Comex Dec) -1.35 per cent at $21.85 (U.S.) an ounce
Copper (Comex Dec) -0.06 per cent at $3.21 (U.S.) a pound
Currencies:
Canadian dollar at 96.76 (U.S.), down 0.0010 from yesterday's North American close.
U.S. dollar index down 0.01 at 81.47
Bonds:
U.S. 10-year Treasury yield 2.92 per cent, up 0.01
ECONOMIC INDICATORS TO WATCH:
Canada second-quarter capacity utilization was 80.6 per cent, below Street forecasts of 82.0.
The U.S. producer price index for August rose 0.3 per cent on a seasonally adjusted basis from July, slightly above economists' forecasts for 0.3 per cent.
U.S. retail sales rose 0.2 per cent in August, below the Street consensus of 0.5 per cent.
(955 a.m. ET) U.S. releases the Reuters/University of Michigan consumer sentiment index for this month, forecast to come in at 82.0.
(10 a.m. ET) U.S. releases business inventories for July, forecast to rise 0.3 per cent.
ANALYST ACTIONS:
Jefferies cut its target on Apple Inc. to $425 (U.S.) from $450.
Jefferies upgraded Intel to "buy" from "hold" and raised its price target to $30 (U.S.) from $27.
Desjardins Securities raised its price target on Transat A.T. Inc. to $15 from $11 and maintained a "buy" rating. Canaccord Genuity raised its target to $17.75 from $10.
BMO Nesbitt Burns raised its price target on Facebook Inc. to $50 (U.S.) from $37 and reiterated an "outperform" rating.
Credit Suisse upgraded Lululemon Athletica Inc. to "outperform" from "neutral."
Canaccord Genuity raised its target on Transcontinental Inc. to $11.90 from $9.40 and maintained a sell rating.
Evercore Partners upgraded Verizon Communications to "overweight" from "equal weight" with a $53 price target.
Credit Suisse upgraded Safeway to "outperform" from "underperform."
M Partners cut its price target on Brick Brewing Co. Ltd. to $1.75 from $2.
THIS MORNING'S TOP INVESTING READS ON THE WEB:
Good news for investors in this year's U.S. technology initial public offerings: they've delivered the biggest first-month returns since 2000.
One of the most dangerous investing ideas out there has been propagated by Warren Buffett acolytes who peddle the "buy what you know" mantra.
Rising interest rates are already slowing down the engine of the U.S. economic recovery.
Why ING Direct's Streetwise portfolios is the best way to get started with index investing.
Looking at the bull case for gold right now.
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For instant headlines on breaking economic and corporate news in the premarket, follow Darcy Keith on Twitter at @eyeonequities.
Darcy Keith