U.S. markets are back in action today after a holiday on Monday and the corporate sector is teeming with major fourth-quarter earnings reports. It should make for an interesting day of trading even though U.S. stock futures suggest a flat start for North American markets this morning.
Japan was a key focus overnight. Its central bank announced the most aggressive steps yet to end years of economic stagnation, saying it would switch to an open-ended commitment to buying assets next year as it doubled its inflation target to 2 per cent.
Yet, U.S. stock futures slipped after the announcement, the Nikkei closed lower, and the Japanese yen strengthened the most in eight months against the U.S. dollar - not helpful for the country's export sector. The central bank's actions were widely expected and already largely factored into the market. There was also some disappointment the bank didn't go further - for instance, the asset purchases won't kick in for another year and the bank didn't set a deadline for the inflation target. And there are plenty of skeptics that think the moves won't successfully kick-start the Japanese economy anyway, after so many years of stagnation.
European stocks are mostly lower this morning, although there was some uplifting data out of Germany. The ZEW economic expectations index, a measure of German investor sentiment, rose more sharply than expected in January, jumping by 24.6 to reach 31.5. That was the highest level since May 2010.
Now, here's a closer look at the latest market action, what economic data are on tap, and what's happening today in corporate news.
U.S. futures: S&P 500 -0.2 per cent; Dow -0.2 per cent; Nasdaq +0.1 per cent
Hong Kong's Hang Seng index +0.29 per cent
Shanghai composite index -0.57 per cent
Japan's Nikkei -0.35 per cent
London's FTSE 100 -0.11 per cent
Germany's DAX -0.77 per cent
France's CAC 40 -0.51 per cent
WTI (Nymex Mar) +0.07 per cent at $96.01 (U.S.) a barrel
Gold (Comex Feb) +0.06 per cent at $1,691.80 (U.S.) an ounce
Copper (Comex Mar) +0.68 per cent at $3.69 (U.S.) a pound
Canadian dollar down 0.0013, or 0.13 per cent, at $1.0059 (U.S.)
Japanese yen up 0.9 per cent at 88.82 per U.S. dollar
ECONOMIC INDICATORS TO WATCH:
Statistics Canada said retail sales in November rose 0.2 per cent from October. Economists had expected a monthly drop of 0.1 per cent.
(1000 a.m. ET) The U.S. National Association of Realtors reports on existing home sales in December. Economists expect 5.1 million annualized sales.
STOCKS TO WATCH
Research In Motion Ltd. shares are up 7 per cent in the U.S. premarket, playing catch-up to activity on the TSX on Monday, when shares rallied nearly 11 per cent. The premarket activity suggests RIM may open down on the TSX while shares surge on the Nasdaq.
Inmet Mining Corp. has recommended that shareholders reject a hostile takeover bid from First Quantum Minerals, saying the $5.1-billion cash and stock bid fails to reflect the value of its massive Cobre Panama project. It says it has approached a number of third parties who have expressed interest in considering strategic alternatives to the First Quantum bid.
Verizon Communications Inc. reported adjusted fourth-quarter earnings of 38 cents per share, missing analysts' expectations of 50 cents. Revenues of $30.05-billion was ahead of Street forecasts of $29.82-billion. Shares are down 2.3 per cent in the premarket.
Freeport-McMoRan Copper & Gold Inc. said its fourth-quarter profit rose 16 per cent to $743-million, or 78 cents a share. Analysts were looking for 71 cents a share. Shares are up 1.6 per cent in the premarket.
Johnson & Johnson said it earned $1.19 per share, excluding special items, in its latest quarter, beating market expectations for $1.17. Global revenue rose 8 percent to $17.56-billion, below Wall Street expectations of $17.7-billion. Shares are down 0.8 per cent in premarket.
E.I. du Pont de Nemours & Co. reported net income of $111-million (U.S.), or 12 cents per share, excluding significant items, compared to net income of $373-million, or 40 cents per share, for the fourth quarter of 2011. The results beat the consensus estimate of Wall Street analysts of 7 cents per share and shares are up 1.4 per cent in the premarket.
Delta Air Lines reported a lower quarterly profit on Tuesday as Superstorm Sandy hurt its airline. Excluding one-time items, profit was 28 cents a share, while revenue rose 2 per cent to $8.6-billion. Both its adjusted profit and its revenue were slightly better than expected by analysts.
Other companies reporting earnings include: Advanced Micro Devices Inc.; Canadian National Railway Co.; Celestica Inc.; CSX Corp.; Google Inc.; International Business Machines Corp.; Northfolk Southern Corp.; TD Ameritrade Holding Corp.; Texas Instruments Inc.; and Travelers Cos. Inc.
THIS MORNING'S TOP INVESTING READS ON THE WEB:
With 72 per cent of corporate earnings exceeding analysts' estimates, it may be difficult for U.S. stocks not to reach a record in 2013.
Investors are finally escaping the fear factory.
Reasons to feel bullish on silver.
Is Wall Street profiting from political insider information?
Top 10 ways to deal with behavioural biases in investing.
The inside story of Facebook's Graph Search.
Be careful about group registered education savings plans. They are loaded with fees.
Does a 60 per cent equities/40 per cent bonds portfolio still make sense?
The premarket report is constantly updated to reflect the latest news developments and market moves. For instant headlines on breaking economic and corporate news in the premarket, follow Darcy Keith on Twitter at @eyeonequities