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.
Markets are showing some tentative signs this morning of extending Monday's gains that brought both the Dow and S&P 500 into record high territory. But enthusiasm for stocks seems to be less entrenched today, as some look to lock in profits while markets are up. A weaker-than-expected U.S. retail sales report at 830 a.m. (ET) also discouraged participants, with U.S. stock futures coming off their morning highs as the data hit.
Dow futures are up nearly 0.2 per cent but futures for the TSX are flat. One bright spot for the TSX is Encana; it solidly beat earnings estimates for its latest quarter and its U.S.-listed shares are up about 4 per cent in premarket trading.
Part of the underperformance in early morning indicators in Canada could be blamed on more discouraging economic data out of China, which has copper retracing some of Monday's gains and once again raising speculation that the country won't be able to meet its 7.5 per cent growth objective for this year.
Data for Chinese industrial output, investment growth and home sales all failed to meet economists' forecasts. Factory output still rose 8.7 per cent in April from year earlier, but that was below Street expectations for 8.9 per cent. Fixed-asset investment rose 17.3 per cent in the first four months of the year, the slowest for the period since 2001. Home sales fell 9.9 per cent.
The government has already announced tax breaks and spending on railways and housing to bolster growth, although those measures seem to have had little impact so far. The central bank today told banks to approve home mortgages in a timely manner, in an effort to prop up the housing market.
Indexes in China and Hong Kong didn't stray too far overnight, however. Japan's Nikkei put in a sold performance thanks to a weaker yen, closing up nearly 2 per cent to more than a one-week high.
Now, here's a closer look at what's going on this morning and what is still to come.
MARKETS:
Equities:
Futures: S&P 500 +0.16 per cent; Dow +0.18 per cent; Nasdaq +0.24 per cent; S&P Toronto -0.04 per cent
Hong Kong's Hang Seng +0.41 per cent
Shanghai composite index -0.09 per cent
Japan's Nikkei +1.95 per cent
London's FTSE 100 +0.14 per cent
Germany's DAX +0.64 per cent
France's CAC 40 +0.21 per cent
Commodities:
WTI crude oil (Nymex Jly) +0.68 per cent at $101.27 (U.S.) a barrel
Gold (Comex Jun) -0.39 per cent at $1,291.00 (U.S.) an ounce
Copper (Comex Jly) -0.33 per cent at $3.14 (U.S.) a pound
Currencies:
Canadian dollar at 91.77 cents (U.S.), down 0.0002
U.S. dollar index up 0.20 at 80.10
Bonds:
U.S. 10-year Treasury yield 2.65 per cent, down 0.01
ECONOMIC INDICATORS:
U.S. retail sales for April rose 0.1 per cent, missing economists' forecasts for a rise of 0.4 per cent. Excluding auto purchases, sales were unchanged, whereas a 0.5 per cent gain was forecast.
(10 a.m. ET) U.S. releases business inventories for March, forecast to rise 0.5 per cent after gaining by the same amount in February.
(1030 a.m. ET) Bank of Canada's bi-annual review.
STOCKS TO WATCH:
AT&T is reportedly in active talks to buy DirecTV and may complete a deal in the next few weeks that could be worth close to $50-billion (U.S.). Shares of DirecTV rose 4.9 per cent in premarket trading.
Valeant Pharmaceuticals International said it plans to improve its offer for Allergan later this month to show its commitment to completing a takeover of the botox maker. Allergan shares are up 2 per cent in the premarket
Pfizer suggested it could raise its proposed $106-billion (U.S.) offer if AstraZeneca engaged in talks.
Baytex Energy increased its offer for Aurora Oil & Gas to $4.20 (Australian) a share.
Encana beat analysts' estimates for both revenue and earnings per share in its latest quarter. Operating earnings per share were 70 cents compared to an adjusted EPS consensus estimate of 50 cents. Shares are up about 4 per cent in the premarket.
Rona Q1 adjusted loss per share was 12 cents, matching Street estimates. But revenues missed Street expectations.
RioCan REIT reported quarterly funds from operations of 42 cents per share, matching Street forecasts.
Other earnings include: Aimia, Carfinco, Finning International, Innergex Renewable, Leisurewold Senior Care, Manitoba Telecom, Sprott Resource, SunOpta, Hertz Global Holdings, Intrawest Resorts Holdings.
ANALYST ACTIONS:
Canaccord Genuity upgraded Pembina Pipeline to "buy" from "hold" and hiked its price target to $48 (Canadian) from $44.
Canaccord Genuity downgraded Inter Pipeline to "hold" from "buy" and kept a $31 (Canadian) price target.
Raymond James upgraded Alliance Grain Traders to "outperform" from "market perform" and hiked its price target to $23 (Canadian) from $21.
Raymond James downgraded Canadian Apartment Properties REIT to "market perform" from "outperform" and suspended its $23.50 (Canadian) price target.
TD Securities upgraded Bird Construction to "buy" from "hold" and hiked its price target to $15.50 (Canadian) from $14.50.
TD Securities upgraded Total Energy Services to "buy" from "hold" and hiked its price target to $26 (Canadian) from $25.
Canaccord Genuity upgraded Entrec to "buy" from "hold" and maintained a $1.60 (Canadian) price target.
Bernstein upgraded Time Warner to "outperform" from "market perform" and raised its price target to $84 (U.S.) from $73.
Bernstein downgraded Nabors to "market perform" from "outperform" but raised its price target to $25 (U.S.) from $24.
BMO Nesbitt Burns downgraded Pinnacle Foods to "market perform" from "outperform" and raised its price target to $36 (U.S.) from $31.
Wunderlich Securities downgraded Concho Resources to "hold" from "buy" and cut its price target to $137 (U.S.) from $147.
Bernstein downgraded Baker Hughes to "market perform" from "outperform" with a price target of $77 (U.S.).
THIS MORNING'S TOP INVESTING LINKS:
A theory on why tablet-market growth just collapsed.
Takeaways from the recent underperformance of small-cap stocks.
What investors need to know about ETNs.
The "stealth-correction" is looming for markets, says Piper Jaffray.
Star manager Jeffrey Gundlach has another theory why bonds have unexpectedly performed so well this year.
Darcy Keith