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.
Get set for an action-packed day in North American markets, highlighted by the conclusion of the Fed's policy meeting this afternoon and Chair Janet Yellen's press conference a short while later in which every word will be scrutinized for hints on when the world's most important central bank may start hiking interest rates.
A major focus is on whether the Fed will keep the words "considerable time" in its statement when discussing how long interest rates will remain at current rock-bottom levels. On Tuesday, global markets rallied in part because influential Wall Street Journal columnist Jon Hilsenrath - known to be widely tapped into the Fed's thinking - said he thought the Fed will keep those two words, but with clarification, because it doesn't want to send a signal right now that rate hikes are imminent. Today, we'll find out if he was right.
The Fed is widely expected to announce further tapering to its bond-buying program, by a further $10-billion to $15-billion, keeping it on track to end next month. But investors are concerned that rate hikes arriving sooner rather than later could risk a market correction - especially at a time when economies in Europe and China are wobbly.
The challenges in the Chinese economy became apparent again today, when its central bank boosted stimulus measures to help accelerate growth. It is injecting 500 billion yuan, or $81-billion (U.S.), into the nation's largest banks, according to several media reports.
Meanwhile, some important economic indicators are coming out of the U.S. today. Most notably, U.S. inflation was below economists' expectations in August and fell from the month previous for the first time in 16 months. Treasury yields fell on the news, given it suggests the Fed will be in no rush to hike rates amid the muted inflation environment.
The euro zone released its inflation figures this morning as well, which showed the annual rise in prices in August unchanged from July at 0.4 per cent. That was actually above the market consensus forecast calling for a 0.3 per cent rise.
Now, here's a closer look at what's going on this morning and what's to come.
MARKETS:
Equities:
Futures: S&P 500 +0.04 per cent; Dow +0.04 per cent; Nasdaq -0.04 per cent; S&P/TSX -0.08 per cent
Hong Kong's Hang Seng +0.99 per cent
Shanghai composite index +0.50 per cent
Japan's Nikkei -0.14 per cent
London's FTSE 100 +0.16 per cent
Germany's DAX +0.48 per cent
France's CAC 40 +0.77 per cent
Stoxx 600 +0.63 per cent
Commodities:
WTI crude oil (Nymex Nov) -0.06 per cent at $93.75 (U.S.) a barrel
Gold (Comex Dec) +0.14 per cent at $1,238.40 (U.S.) an ounce
Copper (Comex Dec) -0.54 per cent at $3.15 (U.S.) a pound
Currencies:
Canadian dollar at 91.17 (U.S.), up 0.0003
U.S. dollar index up 0.03 at 84.10
Bonds:
U.S. 10-year Treasury yield 2.57 per cent, down 0.03
ECONOMIC INDICATORS:
U.S. consumer price index for August fell 0.2 per cent from July - the first time it dropped in 16 months. Versus a year ago, inflation rose 1.7 per cent, below expectations for a rise of 1.9 per cent.
U.S. current account deficit for the second quarter fell to $98.5-billion (U.S.) from $111.2-billion, narrower than Street expectations for $113.4-billion.
(10 a.m. ET) U.S. releases the National Association of Homebuilders index for September, forecast at 57.
(2 p.m. ET) FOMC announcement on interest rates and summary of economic projections. Federal Reserve Chair Janet Yellen will hold a quarterly press briefing at 230 p.m. (ET).
STOCKS TO WATCH:
United States Steel Corp. is up 7 per cent in the premarket after announcing Tuesday night it would apply for relief from creditors under Canada's Companies' Creditors Arrangement Act and said it would drop plans to expand two of its facilities. The company said its Canadian operations, which have lost about $2.4 billion over the past five years, will also be dropped from its financial statements.
Cloud management services provider Ackspace Hosting is down 18 per cent in the premarket after saying it would not sell itself. The company also named President Taylor Rhodes as chief executive, replacing Graham Weston, who co-founded Rackspace.
Adobe Systems is down nearly 5 per cent in the premarket after it forecast disappointing revenue for this quarter and reported lower quarterly sales at its digital media business.
U.S. homebuilder Lennar reported Q3 EPS of 78 cents, well ahead of the consensus estimate of 67 cents. Shares are up 4 per cent in the premarket.
FedEx reported Q1 EPS of $2.10 versus the Street estimate for $1.96. Shares are up 2.6 per cent in the premarket.
General Mills reported Q1 adjusted EPS of 61 cents (U.S.) versus the Street estimate of 69 cents. Shares are down 3 per cent in the premarket.
Steel company Nucor announced guidance for its third-quarter earnings.
Microsoft announced an 11 per cent hike in its quarterly dividend and also said there have been several changes to its board.
U.S.-traded shares of Sony Corp fell 10.6 percent in premarket trading after it estimated a bigger loss and said it would not pay a dividend this fiscal year for the first time since it listed in 1958.
Auxilium Pharmaceuticals Inc adopted a poison pill, a day after an unsolicited $2.2 billion buyout offer from Endo International Plc. Auxilium is in a deal to buy Canada's QLT and there are fears that deal could now fall through. QLT shares are down 15 per cent in the U.S. premarket.
Activist firm Trian Fund Management LP has launched a campaign for the breakup of DuPont Co. Shares rose 4.1 per cent in the premarket.
Bombardier Inc.'s Brazilian rival Embraer SA has clinched a $2.1-billion (U.S.) deal with Republic Airways Holdings Inc. for 50 of its E175 regional jets. The transaction is the latest step in holding company Republic's shift to regional jets on its feeder airlines, a move that threatens Republic's agreement to buy 40 of Bombardier's all-new C Series planes.
Enbridge Inc. announced that it has proposed to transfer its 66.7 per cent interest in the U.S. segment of the Alberta Clipper Pipeline to its affiliate, Enbridge Energy Partners L.P. for approximately U.S. $900 million.
ANALYST ACTIONS:
FirstEnergy Capital upgraded Precision Drilling to "outperform" from "market perform" with a price target of $16 (Canadian).
Goldman Sachs hiked its price target on U.S. Steel to $58 (U.S.) from $47 and reiterated a "buy" rating.
Howard Weil upgraded Baker Hughes to "sector outperform" from "sector perform" with a price target of $81.
Mizuho Securities upgraded Bill Barrett to "buy" from "neutral" with a price target of $28 (U.S.).
Societe Generale downgraded General Mills to "sell" from "hold" with a price target of $50 (U.S.).
THIS MORNING'S TOP READS ON THE WEB:
What to look for in the Fed statement today.
Bill Gross is relying on derivatives rather than Janet Yellen to raise his returns on government bonds.
A simple way to beat the market with stock splits.
How to cultivate trading intuition.
Be careful relying on historical market returns.
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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