Equity Markets
Canada's main stock index rose on Friday to a four-month high as financial shares climbed, while Bombardier Inc got a boost after sealing a deal to sell up to 50 Q400 turboprop planes to India's SpiceJet SPJT.BO.
At 9:41 a.m. ET, the Toronto Stock Exchange's S&P/TSX composite index rose 25.05 points, or 0.16 per cent, to 15,643.3. Seven of the index's 10 main groups were higher.
Bombardier was up 2.5 per cent to $2.27 in early trading.
U.S. stocks were mixed at the open on Friday after data showed cooling consumer spending in August and slowing pace of inflation growth, pointing to moderation in economic activity in the third quarter.
The Dow Jones Industrial Average fell 34.33 points, or 0.15 per cent, to 22,346.87. The S&P 500 lost 0.36 points, or 0.014342 per cent, to 2,509.7. The Nasdaq Composite added 8.63 points, or 0.13 per cent, to 6,462.08.
The Commerce Department said consumer spending, which accounts for more than two-thirds of U.S. economic activity, edged up 0.1 per cent last month as Hurricane Harvey weighed on auto sales.
The core personal consumption expenditures (PCE) price index rose 0.1 per cent in August, slowing the pace of annual rise in core PCE price index to 1.3 per cent, the smallest increase in nearly two years.
Despite inflation remaining stubbornly below the Federal Reserve's 2-per-cent target, the odds of an interest rate hike in December remains high, as suggested by Fed Chair Janet Yellen's recent speech.
Financial markets are pricing in a roughly 71.4-per-cent probability of December move, up from 32.5 per cent a month ago, according to CME Group's FedWatch tool.
Investors also remained skeptical about President Donald Trump's ability to push his tax plan through Congress.
Mr. Trump's plan called for tax cuts for most Americans, but drew criticism that the plan favors business and the rich and could add trillions of dollars to the deficit.
"For the market the most important thing is tax cuts for the corporations and that, most likely, will not be tampered with," said Peter Cardillo, chief market economist at First Standard Financial in New York.
"But any disappointment going forward, would certainly take the wind out of this market as it has rallied on hopes of cuts."
In this country, Statistics Canada said the July reading on gross domestic was flat after eight previous months of growth. Economists had been expecting a moderation but were looking for a monthly advance of about 0.1 per cent.
"The flat reading was a tick weaker than the consensus was looking for, although the miss was driven entirely by the sometimes volatile oil and gas sector," CIBC economist Nick Exarhos said. "That fell by over 1 per cent on the month, and took off 0.1 percentage points from the overall tally."
He says annual growth is still tracking at 3.8 per cent.
In the corporate sphere, union officials and senior General Motors executives say talks over the strike at GM's Cami assembly plant in Ingersoll, Ont., proved constructive. The union says it expects a reply from GM by late Friday on a proposal that includes job security language for about 2,500 workers who assemble the Chevrolet Equinox crossover vehicle at the plant, said Mike van Boekel, unit chair of Unifor Local 88, which represents the workers, The Globe's Greg Keenan reports.
Overseas, VW shares were lower after the car maker said it will take a new $3-billion hit over the diesel emissions scandal. The provision relates to the buyback and retrofit of some vehicles. Volkswagen has recalled more than 11 million vehicles around the globe since admitting two years ago to manipulating emissions tests.
Meanwhile, euro zone stocks managed their best level in three months as analyst forecast earnings for STOXX 600 companies to grow by 11 per cent this year. Britain's FTSE 100 was up 0.75 per cent in the last trading session of the week. Germany's DAX was up 0.51 per cent and France's CAC 40 rose 0.12 per cent.
In Asia, Japan's Nikkei slid 0.03 per cent on weakness in auto makers and some tech shares. Hong Kong's Hang Seng advanced 0.48 per cent and the Shanghai composite index was up 0.29 per cent.
Commodities
Oil prices were higher on continued tensions over Irag's Kurdistan region and the potential impact on oil supplies. Brent crude was trading above $57 (U.S.) a barrel overnight while West Texas Intermediate moved in a day range of $51.34 to $51.77. Earlier this week, Brent managed its best level in more than two years and now looks set for the strongest third-quarter showing since 2004, according to Reuters.
Worries over supply have supported crude prices since a vote Monday by Iraq's Kurds favouring secession. Turkey and other powers have slammed the referendum's outcome, with Turkish President Tayyip Erdogan labelling the vote illegitimate and threatening to deal only with the Baghdad government over oil exports from Iraq.
At this point, however, oil flows from the region have remained unaffected.
Ms. Ozkardeskaya noted, meanwhile, that the Brent-WTI spread has widened in Asia with Moody's saying shale drillers and oil sand producers need crude prices consistently above $50 a barrel for their businesses to remain viable in the long run.
In other commodities, gold prices were up modestly ahead of the release of personal consumption expenditure figures in the United States. The numbers give the Federal Reserve a glimpse of inflationary pressures and are seen as offering a further indication of how soon interest rates will climb. Futures now suggest a 70-per-cent likelihood of another rate hike by December.
Spot gold and U.S. gold futures were both up slightly in early going. Spot gold is seen posting a decline of 2.5 per cent for September after the U.S. dollar found its footing on stronger economic reports and signals from the Fed that it would continue to move borrowing costs higher.
Silver prices were lower, with traders expected a 4 per cent decline for the month but a 1.7-per-cent increase for the quarter. London copper rose to a two-week high and looked set for its fifth straight quarterly gain on strong demand from China.
Currencies and bonds
The Canadian dollar slid Friday after Statistics Canada said economic growth in July was flat. At the same time, the U.S. dollar looked set for its best weekly showing of the year. The loonie fell immediately after the release of Friday's GDP report, which fell short of the analysts' forecasts. Most had been expecting monthly growth of 0.1 per cent. The day's range so far is 80.22 cents to 80.52 cents. The Canadian dollar was at the low end of that range after the GDP figures were made public.
Mr. Exarhos said Friday's GDP report was "little bearish for the Canadian dollar and bullish for the front end, which has a bit more work to do in pricing in a more gradualist Governor Poloz."
The greenback continues to draw support from Mr. Trump's proposed tax overhaul, although some remain skeptical about whether the gains will hold in the long term.
"We need to see more clarity on the data front and the progress of the U.S. tax plan through Congress before we become bullish on the dollar," Thu Lan Nguyen, an FX strategist at Commerzbank AG in London, told Reuters.
The U.S. dollar index, which weighs the currency against a basket of world counterparts, was mostly flat in early going, although it has risen about 1 per cent on the week and is on track for its best showing since the end of last year.
Elsewhere, the euro was flat against the greenback and was down about 1 per cent for the month. The euro looked set for its first down month against the U.S. dollar since February as the results of the weekend election in Germany weigh.
In bonds, the yield on the U.S. 10-year note was higher at 2.31 per cent and the yield on the 30-year note was modestly higher at 2.87 per cent.
Stocks set to see action
A violent protest flared on Friday at a Johannesburg store run by Wal-Mart's South African unit Massmart where workers have staged a week-long strike over wages. Marune Rossouw, a Thomson Reuters employee, said she was trapped inside the store with other shoppers as protesting staff rampaged through the car park, throwing stones at cars. Massmart confirmed that a group of picketing members from the South African Commercial Catering and Allied Workers Union threw objects at the window of one of its Makro liquor stores at around 0800 GMT.
Zogenix Inc.'s experimental treatment for a rare form of epilepsy met the main goal in a late-stage study, the company said on Friday, putting it on track to request regulatory approval next year and more than tripling the value of its shares. The drug - ZX008 - was shown to be superior compared to a placebo in reducing the frequency of seizures in children with Dravet syndrome, a genetic dysfunction in the brain which results in potentially fatal, long-lasting, fever related seizures that do not respond to standard treatment. Zogenix also said the drug reduced the number of patients suffering seizures in comparison with a placebo. Shares in the U.S.-based drug developer soared 164 per cent to $33.75 in premarket trading from a close of $12.88 on Thursday.
German drugs and pesticides group Bayer said it had further reduced to just under 25 per cent its holding in Covestro, the plastics producer which it demerged in 2015, by selling a 6.9-per-cent stake for $1.2 billion.
MacDonald, Dettwiler and Associates Ltd. says it has signed a five-year contract with Canada's Department of National Defence (DND) to extend its operational support. That includes the use of the east and west coast Radarsat-2 ground systems for the DND Polar Epsilon Near Real-Time Ship Detection (NRTSD) system.
Temple Hotels Inc. says it completed the sale of the Holiday Inn Express Hotel & Suites in Sherwood Park, Alta., for $9.6-million, excluding taxes and transaction costs. "This divestiture is an important step in the execution of our strategic plan that will drive the long-term success of the Company," said CEO K. Rai Sahi. "The opportunistic sale of this property enables us to meet our financial obligations while continuing to strategically diversify the company's portfolio and decrease our reliance on a single geographic market."
Twitter said on Thursday it had suspended about 200 Russian-linked accounts as it probes online efforts to meddle with the 2016 U.S. election, but an influential Democratic senator slammed its steps as insufficient. Senator Mark Warner, the top Democrat on the Senate Intelligence Committee, summoned Twitter officials to testify behind closed doors on Thursday as part of broad investigation of Russian influence in the 2016 presidential election. Facebook faced a similar grilling earlier this month.
Nvidia was up 1.35 per cent in premarket trading after Citigroup raised its price target on the stock.
KB Home rose 3 per cent after the homebuilder's profit and revenue came above estimates, prompting a slew of price-target raises.
Electronics and furniture retailer Conn's was up 5.26 per cent after Oppenheimer upgraded the stock to "outperform."
Tyson Foods is cutting about 450 jobs as its integrates it recent purchase of sandwich company AdvancePierre Foods. Tyson said it will save $200-million a year between 2018 and 2020 due to the cuts. Tyson's shares rose 6.1 per cent in premarket trading.
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Economic News
Canada's GDP was flat in July. Economists had expect growth of 0.1 per cent for the month.
U.S. consumer spending barely rose in August likely as Hurricane Harvey weighed on auto sales and annual inflation increased at its slowest pace since late 2015, pointing to moderation in economic growth in the third quarte. Reuters reports. The Commerce Department said on Friday consumer spending, which accounts for more than two-thirds of U.S. economic activity, edged up 0.1 per cent last month. Last month's gain in consumer spending was in line with economists' expectations. When adjusted for inflation, consumer spending slipped 0.1 per cent in August, the first drop since January.
"There were few surprises in today's U.S. data, with the 0.2-per-cent rise in incomes and 0.1-per-cent gain in spending matching consensus expectations," CIBC economist Andrew Grantham said in a note. "Given the impact that hurricane Harvey had on retail sales toward the end of the month, the slightly softer pace of spending was expected. "
He said the only slight disappointment in today's figures came on the inflation front, "with core PCE prices not showing the same firming that was seen in the CPI data for the same month."
The 0.1-per-cent increase in core PCE for the month and 1.3 per cent year-over-year were both just below expectations, although not enough to move markets, he said.
(10 a.m. ET) U.S. University of Michigan Consumer Sentiment for September is released.
With files from Reuters