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.
North American stock futures are little changed this morning after Wednesday's market thrashing, but crude oil prices are continuing to tumble, pointing to another tough session for Canadian oil stocks.
A major focus this morning is on the European Central Bank, which has kept interest rates unchanged at extraordinarily low levels, as expected. It's current holding a news conference, in which ECB head Mario Draghi said the bank will buy asset-backed securities in the fourth quarter to help prop up the economy and prevent a deflationary spiral.
That comes as no surprise, as the ECB announced in June that it planned to start buying asset-backed securities - bundled loans - and covered bonds, another form of secured debt, later in the year. A Reuters poll on Monday showed money market traders on average expect the ECB to buy a total of 200 billion euros of asset-backed securities and covered bonds over a year. Mr. Draghi said more details on its plans will be released later today.
West Texas Intermediate crude prices are down nearly another 2 per cent today, trading at their lowest level since April 2013. Brent crude is at two-year lows and is threatening to break below the $90 (U.S.) level. Price cuts today from top producer Saudi Arabia has added to worries about oversupply and weak demand due to sluggish economies in China and Europe. The sharp cuts in official selling prices from state producer Saudi Aramco to Asian customers this week came as the clearest sign yet that the world's largest exporter is trying to compete for crude market share, amplified supply concerns.
A risk-off mentality further invaded Wall Street Wednesday as the U.S. released lackluster manufacturing and other data. Small-cap stocks, as measured by the Russell 2000 index, are now down 10 per cent from their recent highs - technically in correction territory. Friday brings the all-important nonfarm payrolls data, and traders likely will stay cautious heading into that report, which may provide further clues on the timing of the expected Federal Reserve interest rate hike next year.
Meanwhile, it was a rough session in Tokyo overnight, with the Nikkei index falling 2.6 per cent as the value of the yen rose against the U.S. dollar and as traders there reacted to Wednesday's slide on Wall Street. There was continued unrest in the streets of Hong Kong, although markets both there and in mainland China were closed for a holiday.
Now, here's a closer look at what's happening this morning and what's to come.
MARKETS:
Equities:
Futures: S&P 500 +0.07 per cent; Dow +0.02 per cent; Nasdaq +0.08 per cent; S&P/TSX -0.13 per cent
Hong Kong's Hang Seng Closed for holiday
Shanghai composite index Closed for holiday
Japan's Nikkei -2.61 per cent
London's FTSE 100 -0.22 per cent
Germany's DAX -0.04 per cent
France's CAC 40 -0.24 per cent
Stoxx 600 -0.65 per cent
Commodities:
WTI crude oil (Nymex Nov) -1.58 per cent at $89.34 (U.S.) a barrel
Natural gas (Nymex Nov) +0.15 per cent at $4.03 (U.S.)
Gold (Comex Dec) -0.38 per cent at $1,210.90 (U.S.) an ounce
Copper (Comex Dec) -0.61 per cent at $3.02 (U.S.) a pound
Currencies:
Canadian dollar at 89.91 (U.S.), up 0.0035
U.S. dollar index down 0.22 at 85.75
US dollar vs euro 0.7914, down 0.0012
Bonds:
U.S. 10-year Treasury yield 2.41 per cent, up 0.02
ECONOMIC INDICATORS:
U.S. initial jobless claims came in better than expected for last week, with 287,000 new claims filed, down 8,000 from the prior week, versus Street expectations for 297,000.
(10 a.m. ET) U.S. releases factory orders for August. Consensus is for a decline of 9 per cent after they surged 10.5 per cent in July.
STOCKS TO WATCH:
Sears Holdings is selling most of its stake in its Canadian unit to raise as much as $380-million (U.S.) and increase its cash holdings ahead of the crucial holiday shopping season. It will sell about 40 million Sears Canada shares to its own shareholders.
Canadian Pacific Railway late Wednesday revealed new four-year financial targets, include increasing annual revenue to $10-billion, from about $6.7-billion in 2014, and generating cumulative cash flow before dividends of $6-billion. It also plans to more than double the earnings per share from the current 2014 estimate of $8.53. CP Rail shares are up 0.3 per cent in the U.S. premarket.
Agrium late Wednesday cut guidance for the third and fourth quarters. Shares are down 5 per cent in the U.S. premarket.
Tesla shares are up nearly 3 per cent in the premarket as CEO Elon Musk hinted on Twitter there will be an Oct. 9 product announcement. An image that accompanied the tweet suggested the unveiling might include a new vehicle model.
Berkshire Hathaway acquired auto dealership company Van Tuyl Group, the fifth largest U.S. auto dealership group. Terms were not disclosed.
Earnings include Constellation Brands; Global Payments.
ANALYST ACTIONS:
Raymond James upgraded Canadian Pacific Railway to "strong buy" from "outperform" and hiked its price target to $280 (Canadian) from $220. Canaccord Genuity hiked its price target to $237 (Canadian) from $188 and kept a "hold" rating.
Canaccord Genuity upgraded Barrick Gold to "hold" from "sell" and hiked its price target to $20 (Canadian) from $19. It cited recent share price weakness and better valuation of its core Nevada assets.
TD Securities downgraded Bank of Nova Scotia to "hold" from "buy" with a price target of $75 (Canadian).
Deutsche Bank upgraded Encana to "buy" from "hold" and a $31 (Canadian) price target.
TD Securities upgraded Veresen to "buy" from "hold" with a $19.50 (Canadian) price target.
JPMorgan upgraded Twitter to "overweight" from "neutral" and raised its target to $64 (U.S.) from $54. Shares in the company are up 2 per cent in the premarket.
THIS MORNING'S TOP READS ON THE WEB:
Nouriel Roubina - a.k.a. Dr. Doom - warns of rising risks around the world.
Don't count on REITs getting hurt in a rising interest rate environment.
Taking a close look at ETFs that try to mimic what the investing gurus are doing.
Redemptions from Pimco funds — not just ones once managed by Bill Gross — could reach tens of billions of dollars.
Abenomics: Will the sun rise on Japan again?
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With files from Reuters
Have feedback on our daily Before the Bell report and suggestions on how to make it more useful in your investing day? Please contact Inside the Market Editor Darcy Keith at dakeith@globeandmail.com.
Darcy Keith