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.
U.S. and Canadian stock futures are modestly weaker this morning, as traders took in largely favourable economic data out of the U.S.
Inflation for April rose only modestly, as expected, and initial jobless claims came in at a lower level than Street forecasts. There was surprising strength in a manufacturing survey for the New York region.
The primary focus overnight was on the latest readings on gross domestic product for both Japan and the euro zone. Japan's economy grew at an annualized pace of 5.9 per cent for the first quarter, its strongest level since mid 2011, suggesting Japanese consumers are opening their wallets more often. The GDP reading for the euro zone, however, disappointed. The 18 nation blow saw economic growth of 0.2 per cent in the first quarter, only half of what economists were expecting, and Greece's economy shrank to its slowest pace in almost four years. The report fueled more speculation that the European Central Bank could soon take steps to speed up the pace of economic recovery, including a possible cut to interest rates or implementing a negative deposit rate.
Closer to home, this is a big day for retailers reporting their first-quarter results in the United States. The biggest of them all, Wal-Mart, disappointed the Street as it offered a weak earnings forecast for the current quarter after posting another drop in U.S. sales in the three months ended April 30. Its shares are down 3 per cent in the premarket, and the stock is likely to weigh on the broader market.
Meanwhile, the situation in Ukraine remains tense. Russia's foreign minister said today that Ukraine is sliding into a civil war that could make it impossible to hold legitimate elections.
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 -0.14 per cent; Dow -0.14 per cent; Nasdaq -0.05 per cent; S&P Toronto -0.13 per cent
Hong Kong's Hang Seng +0.66 per cent
Shanghai composite index -1.12 per cent
Japan's Nikkei -0.75 per cent
London's FTSE 100 -0.01 per cent
Germany's DAX -0.07 per cent
France's CAC 40 -0.29 per cent
Commodities:
WTI crude oil (Nymex Jly) -0.29 per cent at $101.45 (U.S.) a barrel
Gold (Comex Jun) +0.01 per cent at $1,306.00 (U.S.) an ounce
Copper (Comex Jly) +0.03 per cent at $3.16 (U.S.) a pound
Currencies:
Canadian dollar at 92.00 cents (U.S.), up 0.0015
U.S. dollar index up 0.21 at 80.28
Bonds:
U.S. 10-year Treasury yield 2.55 per cent, down 0.001
ECONOMIC INDICATORS:
Canada manufacturing sales for March rose 0.4 per cent, after gaining 1.4 per cent in February. That easily surpassed Street expectations calling for a decline of 0.2 per cent.
Initial U.S. jobless claims for last week came in at 297,000, a better reading than the 317,000 that was expected.
U.S. April consumer price index rose 0.3 per cent, matching Street forecasts.
U.S. Empire Manufacturing survey for May came in at 19.01, well ahead of expectations of 6.0.
U.S. industrial production fell 0.6 per cent in April, versus expectations for a flat reading.
Canadian existing home sales rose 2.7 per cent in April from March, beating Street forecasts for a 2 per cent rise, with MLS prices rising 5 per cent.
(10 a.m. ET) U.S. Philadelphia Fed Index. Consensus is for a reading of 13.5, down from April's 16.6.
(10 a.m. ET) U.S. National Association of Home Builders releases housing market index for May, forecast to come in at 49.
STOCKS TO WATCH:
General Motors shares are down 1.6 per cent in the premarket after announcing five new safety recalls covering about 2.7 million vehicles. It will take a $200-million charge in the second quarter related to the recalls.
Bank of Nova Scotia said late Wednesday it plans to sell a $3.8-billion stake in CI Financial.
Air Canada reported adjusted earnings of 46 (Canadian) cents per share, narrowly beating analysts' average estimate of earnings - according to Reuters - of 45 cents per share.
Wal-Mart reported a 5 per cent drop in quarterly profit as severe winter weather took its toll on sales and its EPS came in 5 cents below the Street consensus. For the current quarter, it expects adjusted earnings of $1.15 to $1.25 a share, below analysts' expectations of $1.28. Shares are down 3 per cent in the premarket.
Shares of Cisco Systems are up 7 per cent in premarket trading after the company late Wednesday posted a shallower-than-expected 5.5 per cent drop in quarterly revenue.
Other earnings today include: Air Canada, CAE, Just Energy, Power Corp., Stantec, Advance Auto Parts, Autodesk, First Majestic Silver, J.C. Penney, Kohl's, Manchester United, Nordstrom.
ANALYST ACTIONS:
Canaccord Genuity downgraded CI Financial to "hold" from "buy" and cut its price target to $34.50 (Canadian) from $41.25, after Scotiabank's announcement that it may sell its stake in the company. Desjardins Securities placed CI Financial under review and cut its target to $38.50 from $41, saying it was disappointed with Scotia's plans.
RBC Dominion Securities downgraded Aimia to "sector perform" from "outperform" and maintained a $19 (Canadian) price target.
Industrial Alliance downgraded Carfinco Financial Group to "buy" from "strong buy" and cut its price target to $11 (Canadian)from $13.
Raymond James hiked its target on RioCan REIT to $29 (Canadian) from $27 and maintained an "outperform" rating.
BMO Nesbitt Burns downgraded Bristol-Myers Squibb to "market perform" from "outperform" and cut its price target to $55 (U.S.) from $60.
FBR Capital downgraded Urban Outfitters to "market perform" from "outperform" and cut it price target to $37 (Canadian) from $44.
Atlantic Equities upgraded Twitter to "neutral" from "underweight" and maintained a $35 (U.S.) price target.
Goldman Sachs upgraded Kinder Morgan to "conviction buy" from "neutral" with a price target of $44 (U.S.).
Goldman Sachs upgraded Range Resources to "conviction buy" from "neutral" and raised its price target to $110 (U.S.) from $104.
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