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 relatively calm this morning after the thrashing they took Thursday, as traders take in a final reading on U.S. economic growth in the second quarter that came in largely as expected. U.S. stock futures are building upon early slight gains, with futures for the Dow Jones industrial average now up about 0.3 per cent.
BlackBerry shares initially rallied more than 5 per cent in the U.S. premarket after reporting a quarterly adjusted loss that was better than expected. The stock later retraced those gains, however, and is currently down 2 per cent. Revenues were below Street forecasts, underscoring the challenges the smartphone maker faces as it tries to return to profitability.
The temptation to do some bargain hunting is on the rise after the TSX's five consecutive daily declines that has returned the main index back to May levels - but there's still a lot of nervousness that the end of this pullback isn't over yet.
The steep selloff in U.S. and especially Canadian stocks over the last week has been blamed on a number of catalysts, ranging from Chinese economic growth fears to geopolitical developments in Russia and the Middle East. But the biggest concern has been when the Federal Reserve is likely to pull the trigger on higher interest rates. Dallas Fed President Richard Fisher suggested Thursday that a rate hike could occur in the spring of 2015.
Tightening monetary policy at a time of high valuations for stocks is a dangerous combination, especially given a sizeable percentage of earnings per share growth in recent quarters can be attributed to aggressive corporate stock buybacks. The strength in the U.S. dollar this week has been a major influence in driving down commodity prices; this morning, the greenback is relatively steady against major currencies.
Now, here's a closer look at what's going on this morning and what is to come.
MARKETS:
Equities:
Futures: S&P 500 +0.24 per cent; Dow +0.28 per cent; Nasdaq +0.29 per cent; S&P/TSX +0.01 per cent
Hong Kong's Hang Seng -0.38 per cent
Shanghai composite index +0.12 per cent
Japan's Nikkei -0.88 per cent
London's FTSE 100 +0.03 per cent
Germany's DAX +0.03 per cent
France's CAC 40 +0.71 per cent
Stoxx 600 +0.16 per cent
Commodities:
WTI crude oil (Nymex Nov) +0.45 per cent at $92.95 (U.S.) a barrel
Gold (Comex Dec) +0.03 per cent at $1,222.20 (U.S.) an ounce
Copper (Comex Dec) +0.51 per cent at $3.05 (U.S.) a pound
Currencies:
Canadian dollar at 90.08 (U.S.), up 0.0013
U.S. dollar index up 0.05 at 85.25
Bonds:
U.S. 10-year Treasury yield 2.53 per cent, up 0.02
ECONOMIC INDICATORS:
U.S. GDP for the second quarter was revised to growth of 4.6 per cent in a final reading, up from 4.2 per cent. The revision higher matched expectations by the Street.
(955 a.m. ET) U.S. releases the University of Michigan Consumer Sentiment index, forecast at 85.0.
STOCKS TO WATCH:
BlackBerry shares are down 2 per cent per cent in the U.S. premarket, after initially rallying more than 5 per cent after releasing its latest earnings. While its quarterly revenue of $916-million (U.S.) was lower than the consensus call of $950-million, its adjusted loss per share of 2 cents was much better than the loss of 16 cents that the Street expected.
Janus Capital shares have shot up 38 per cent in the premarket on news that bond guru Bill Gross will join the company, and leave PIMCO. Some PIMCO ETFs are getting hit in the premarket, with the PIMCO Corporate & Income Opportunity Fund down 6 per cent.
Nike shares are up 7 per cent in the premarket after the world's largest sportswear maker reported a better-than-expected quarterly profit.
Micron Technology shares are up 6 per cent after the memory chipmaker posted fiscal fourth-quarter results and a revenue outlook that impressed Wall Street.
Bombardier Inc.'s C Series jet program got a big boost Friday with the announcement that Macquarie AirFinance of Australia has committed to the purchase of 40 planes. While Bombardier did not disclose the value of the deal, it is estimated to be about $3-billion.
ANALYST ACTIONS:
Raymond James cut its price target on Horizon North Logistics to $7 (Canadian) from $8.50 and reiterated an "outperform" rating.
Canaccord Genuity raised its price target on Bombardier to $5.50 (Canadian) from $5 and maintained a "buy" rating.
Cowen upgraded LinkedIn to "outperform" from "market perform" and raised its price target to $253 (U.S.) from $195.
Merrill Lynch downgraded Philip Morris to "neutral" from "buy" and cut its price target to $87 (U.S.) from $91, citing the strong U.S. dollar.
Deutsche Bank upgraded Northrop Grumman to "buy" from "hold" and raised its price target to $145 (U.S.) from $140.
THIS MORNING'S TOP READS ON THE WEB:
The U.S. market is sending a worrisome signal on inflation.
Averaging down in a losing stock isn't nearly as easy as it seems and often doesn't work.
About 50 per cent of Yahoo shares have changed hands over the past four days.
Why this senior financial planner at index-leader Vanguard personally owns actively managed funds.
With China set to open stock trading, investors lay groundwork.
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Darcy Keith