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.
Federal Reserve chairman Ben Bernanke's assurances that U.S. interest rates will remain near zero is having little impact on global stocks on Wednesday. Dow Jones industrial average futures were flat, European markets were down about 0.4 per cent, Japan's Nikkei 225 fell 0.3 per cent in overnight trading and emerging markets stocks were off about 0.6 per cent.
In other words, stocks continue to look jittery just days after hitting either record -- or multi-year -- highs. Part of the problem is that many observers -- most recently, Carl Icahn and Jeremy Grantham -- are expressing some caution over the fact that major stock market indexes have diverged from uninspiring economic and earnings data.
The other issue is that central bank actions are losing their ability to impress investors. Fed chairman nominee Janet Yellen has said at Senate hearings that the U.S. economy needs more stimulus. And Mr. Bernanke said on Tuesday that the key rate could stay near zero even after the country's unemployment rate falls below 6.5 per cent – a shift given that 6.5 per cent used to be seen as a threshold for raising rates. These moves follow last week's decision by the European Central Bank to cut its key rate to just 0.25 per cent. Perhaps investors are seeing these decisions as acts of desperation.
They'll learn more this afternoon when the Fed releases the minutes from its last monetary policy meeting – shedding light on the Fed's decision to maintain its bond-buying program, known as quantitative easing or QE.
In other economic news, look for October readings on U.S. retail sales in October. As for earnings, there's Staples Inc., Lowe's Cos Inc., Deere & Co, and J.C. Penney Co. Inc.
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 +0.01 per cent; Nasdaq +0.20 per cent; S&P Toronto -0.03 per cent
Hong Kong's Hang Seng +0.18 per cent
Shanghai composite index +0.63 per cent
Japan's Nikkei -0.33 per cent
London's FTSE 100 -0.30 per cent
Germany's DAX -0.07 per cent
France's CAC 40 -0.36 per cent
Commodities:
WTI crude oil (Nymex Jan) +0.19 per cent at $94.06 (U.S.) a barrel
Gold (Comex Dec) -1.04 per cent at $1,260.00 (U.S.) an ounce
Copper (Comex Dec) -0.02 per cent at $3.17 (U.S.) a pound
Currencies:
Canadian dollar at 95.68 (U.S.), vs. 95.50 at Tuesday's North American close.
U.S. dollar index down 0.06 at 80.63
Bonds:
U.S. 10-year Treasury yield 2.72 per cent, +0.009
ECONOMIC INDICATORS:
Canada wholesale trade sales for September rose 0.2 per cent from August; forecast was for rise of 0.3 per cent.
U.S. retail sales for October rose 0.4 per cent in October; Street was expecting a flat reading. Excluding autos, retail sales still rose 0.2 per cent.
The U.S. consumer price index in October fell 0.1 per cent from September; Street was expecting a flat reading.
(10 a.m. ET) U.S. releases existing home sales for October, forecast to fall 2.7 per cent month-over-month after previously declining 1.9 per cent.
(2 p.m. ET) Federal Reserve releases minutes from its last meeting.
STOCKS TO WATCH:
Yahoo shares are up 3.2 per cent in the premarket after the company announced late Tuesday it will add $5-billion to its share buyback program.
Deere reported fourth-quarter EPS of $2.11, surpassing the Street view of $1.89. Shares are up 3 per cent in the premarket.
Lowe's reported third-quarter EPS of 47 cents a share, below the Street consensus of 49 cents but revenues exceeded expectations and the company raised its outlook for the current fiscal year. Shares are down nearly 3 per cent in the premarket.
J.C. Penney reported a third-quarter adjusted loss of $1.81 per share, versus the Street estimate of $1.77. Shares are up 4.4 per cent in the premarket, as the company said its holiday sales will improve from a year earlier.
Staples earned 42 cents per share from continuing operations in its latest quarter, matching the average analyst forecast. Shares are up 1 per cent in the premarket.
Other earnings today include: Gold Fields Limited Sponsored ADR; Green Mountain Coffee Roasters; J. C. Penney; Jack in the Box; Perry Ellis International; The J. M. Smucker; Williams-Sonoma.
ANALYST ACTIONS:
BGC Partners downgraded Potash Corp. to "hold" from "buy" and reduced its price target to $33 (U.S.) from $35.
BGC Partners downgraded Mosaic to "hold" from "buy" and cut its price target to $47 (U.S.) from $50.
CIBC World Markets downgraded Fortress Paper to "sector underperformer" and slashed its price target to $4.50 from $17.50.
Cantor Fitzgerald downgraded Twitter to "hold" from "buy" and maintained a $32 (U.S.) price target.
Goldman Sachs adds Priceline to "conviction buy" from "buy" and raised its price target to $1,500 (U.S.) from $1,260.
Citigroup upgraded Best Buy to "buy" from "neutral" and raised its price target to $48 (U.S.) from $44.
Canaccord Genuity downgraded Coastal Energy to "sell" from "buy" and maintained a $19 (Canadian) price target.
Canaccord Genuity raised its price target on Alimentation Couche-Tard to $79 (Canadian) from $69 and maintained a "buy" rating.
RBC Dominion Securities initiated coverage on CT Real Estate Investment Trust with a "sector perform" rating and $11.50 (Canadian) price target.
CIBC cut its target on Sears Canada to $16 (Canadian) from $21 and maintained a "sector outperformer" rating, expecting shares to drop by $5 after going ex-dividend.
CIBC cut its target on George Weston to $92 (Canadian) from $96 and maintained a "sector performer" rating, as its quarterly EBITDA came in below the bank's expectation.
THIS MORNING'S TOP INVESTING LINKS:
10 high-conviction purchases by Morningstar's ultimate stock-pickers.
Warren Buffett says stocks are "in a zone of reasonableness."
The Dow is approaching, but has not yet eclipsed, its record high when adjusted for inflation.
Why investors may have no where to hide should the market significantly pull back.
U.S. REITs are on sale.
Why all of the skeptical bubble talk of late seems to be a contrarian indicator that this long-in-the-tooth, overpriced market might still have a ways to go.
A lesson from Apple and Bank of America on how making money boils down to beating expectations.
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For instant headlines on breaking economic and corporate news in the premarket, follow Darcy Keith on Twitter at @eyeonequities.
David Berman