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.
Global equity markets and North American stock futures are being bid up this morning, as the fears of a banking crisis in Portugal continue to recede and investors look ahead to a busy week of second-quarter earnings.
S&P 500 futures are up about 0.4 per cent, with advances in Toronto futures more subtle amid weakness in major commodities, including a 1 per cent drop in gold.
Gold was bid up last week as financial irregularities at holding companies of Banco Espirito Santo, the country's largest bank, were disclosed - a reminder that the European economic recovery remains fragile. But Portugal's government and central bank have since offered assurances that the country's financial system was sound, and Banco Espirito Santo put new executives in place who were originally scheduled to take over at the end of July. The bank is trading down about 7 per cent this morning.
Today is a quiet one in terms of economic data. On the corporate front, Citigroup has released better-than-expected second-quarter earnings, helping to boost positive market sentiment further this morning.
The quarterly earnings season kicks into higher gear later this week, with more big U.S. banks set to report results alongside many key names in the tech sector. Overall, analysts expect profit at S&P 500 companies to rise 4.5 per cent for the April to June period, with sales gaining 3.1 per cent, according to Bloomberg estimates.
There's plenty of new action today that builds upon the recent trend of M&A activity in the pharmaceutical sector. London-listed drugmaker Shire Plc succumbed to an increased $53-billion (U.S.) takeover offer from Abbvie, ending a long-running takeover battle. And generic drugmaker Mylan Inc said it would buy Abbott Laboratories' specialty and branded generics business outside the United States in an all-stock transaction valued at about $5.3 billion.
Now, here's a closer look at what's going on this morning and what's to come.
MARKETS:
Equities:
Futures: S&P 500 +0.44 per cent; Dow +0.48 per cent; Nasdaq +0.50 per cent; S&P/TSX +0.14 per cent
Hong Kong's Hang Seng +0.49 per cent
Shanghai composite index +0.98 per cent
Japan's Nikkei +0.88 per cent
London's FTSE 100 +0.66 per cent
Germany's DAX +0.70 per cent
France's CAC 40 +0.54 per cent
Commodities:
WTI crude oil (Nymex Sep) -0.30 per cent at $100.00 (U.S.) a barrel
Gold (Comex Aug) -1.09 per cent at $1,322.90 (U.S.) an ounce
Copper (Comex Sep) -0.08 per cent at $3.27 (U.S.) a pound
Currencies:
Canadian dollar at 93.12 (U.S.), down 0.0004
U.S. dollar index down 0.03 at 80.15
Bonds:
U.S. 10-year Treasury yield 2.53 per cent, up 0.001
STOCKS TO WATCH:
Citiigroup reported Q2 adjusted EPS of $1.24 (U.S.) versus the Street estimate of $1.06. Revenues also beat Street views. The bank earlier this morning said it has reached a $7-billion (U.S.) settlement with the U.S. Justice Department, ending an investigation into whether the bank defrauded investors on mortgage-backed securities in the years that led up to the financial crisis. Shares are up 3 per cent in the premarket.
Mylan said it would buy Abbott Laboratories' specialty and branded generics business outside the United States in an all-stock transaction valued at about $5.3-billion (U.S.). Mylan shares are up nearly 10 per cent in premarket trade while Abbot shares are up 2.3 per cent.
Other earnings today include: Sirius XM Canada.
Export Development Canada is teaming up with its British counterpart and Quebec's economic development agency to create a financing partnership for Bombardier's new C Series aircraft. The three agencies will "actively look for opportunities to work together to provide financing solutions for CSeries customers among the world's commercial airlines and lessors."
ANALYST ACTIONS:
Canaccord Genuity upgraded Athabasca Oil to "buy" from "hold" and reiterated a $9.75 (Canadian) price target.
Raymond James downgraded Semafo to "market perform" from "outperform" but raised its price target to $5 (Canadian) from $4.75.
Raymond James downgraded Sandstorm Gold to "market perform" from "outperform" but raised its price target to $8 (Canadian) from $7.
Desjardins Securities hiked its price target on DragonWave to $2.20 (Canadian) from $1.70 and maintained a "hold" rating.
Raymond James raised its price target on Paramount Resources to $82.50 (Canadian) from $69 and maintained a "strong buy" rating.
AltaCorp raised its price target on Air Canada to $15 (Canadian) from $13 and maintained an "outperform" rating.
Several analysts initiated coverage on Kinaxis, a provider of cloud-based subscription software. Canaccord Genuity gave it a "buy" rating and $19 (Canadian) price target; RBC Dominion Securities an "outperform" rating with $19 target; and BMO Nesbitt Burns an "outperform" rating and $18 target.
Barclays upgraded Apple to "overweight" from "equalweight" and raised its price target to $110 (U.S.) from $95.
Barclays upgraded Lear to "overweight" from "equalweight" and raised its price target to $113 (U.S.) from $93.
JPMorgan downgraded Wells Fargo to "neutral" from "overweight" and cut its price target to $52 (U.S.) from $54.50.
Evercore Partners upgraded Nasdaq OMX Group to "overweight" from "equal weight" with a price target of $46 (U.S.).
THIS MORNING'S TOP INVESTING LINKS:
The top 5 worst investing ideas Barry Ritholtz has heard this year.
Individual investors are plowing money back into the U.S. stock market just as professional strategists say gains for this year are over.
Robert Shiller says there is a high probability that investment returns over the next decade will be below average.
Why you should probably own fewer stocks.
Landing top talent is getting so tough in Silicon Valley that technology companies are trying anything for an edge - including hiring interns out of high school.
Market valuations aside, this is still a great time to invest.
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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