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.
U.S. and Canadian stock futures are higher and gaining further strength as the opening bell approaches, pointing to a second day of recovering equity prices after the steep tech-led selloff that started on Friday.
Futures for the major indexes are up in the 0.2 per cent to 0.4 per cent range, with commodities mostly flat. Futures for Nasdaq, which suffered the most during the recent selloff, are bouncing back the strongest this morning.
Aluminum giant Alcoa offered a bit of encouragement to nervous investors worried about corporate profit growth when it unofficially kicked off the first-quarter earnings season late Tuesday. Its adjusted earnings topped the Street consensus, even though revenues came in a little short - and it also projected a healthy 7 per cent gain in aluminum demand this year. Even more important first-quarter earnings reports will arrive Friday, when JPMorgan and Wells Fargo are due to report. Here in Canada, Dollarama is out with its earnings this morning; it once against surpassed analysts' views and hiked its dividend.
In overseas markets, Wall Street's gains on Tuesday inspired gains across most major indexes - although the Nikkei fell 2.1 per cent to its lowest level in three weeks. The fall was again linked to the yen, which strengthened after the head of the Bank of Japan provided few hints of future monetary stimulus at the conclusion of the central bank's policy meeting.
Despite the pullback in markets late last week that reignited talk of a pending correction, the major indexes remain pretty close to record or multi-year highs. The S&P/TSX composite index is only about 100 points shy of its nearly six-year high hit April 4, and the S&P 500 is only 42 points away from its all-time record. It appears value hunters have been busy buying on the dip, after worries about stretched valuations in the technology sector led to the recent selloff.
Now, here's a closer look at what's going on this morning and what's to come.
MARKETS:
Equities:
Futures: S&P 500 +0.29 per cent; Dow +0.37 per cent; Nasdaq +0.44 per cent; S&P Toronto +0.24 per cent
Hong Kong's Hang Seng +1.09 per cent
Shanghai composite index +0.32 per cent
Japan's Nikkei -2.10 per cent
London's FTSE 100 +0.79 per cent
Germany's DAX +0.30 per cent
France's CAC 40 +0.48 per cent
Commodities:
WTI crude oil (Nymex May) +0.01 per cent at $102.57 (U.S.) a barrel
Gold (Comex Jun) -0.45 per cent at $1,303.20 (U.S.) an ounce
Copper (Comex May) -0.48 per cent at $3.04 (U.S.) a pound
Currencies:
Canadian dollar at 91.48 (U.S.), down 0.0006
U.S. dollar index up 0.04 at 79.79
Bonds:
U.S. 10-year Treasury yield 2.70 per cent, up 0.02
ECONOMIC INDICATORS:
(10 a.m. ET) U.S. releases wholesale inventories for February. Consensus is calling for a 1.0 per cent rise, after falling 1.8 per cent in January.
(2 p.m. ET) FOMC releases minutes from its March meeting. Investors will be listening for signals on when the Fed may start hiking interest rates, something its chair has suggested won't happen at least until the second quarter of next year.
STOCKS TO WATCH:
Dollarama reported fourth-quarter EPS of $1.17 versus the Street estimate of $1.10. It also boosted its dividend by 14 per cent.
Constellation Brands reported fourth-quarter adjusted EPS of 81 cents, beating the Street estimate of 76 cents. Shares are up 3.6 per cent in the premarket.
Alcoa shares are up 2.7 per cent in the premarket after reporting adjusted first-quarter earnings of 9 cents a share, beating the Street estimate of 9 cents. Revenues of $5.45-billion fell short of Street projections of $5.55-billion.
Other earnings include: Cogeco Cable, Cogeco Inc., Bed Bath & Beyond, PriceSmart, Ruby Tuesday.
ANALYST ACTIONS:
CIBC World Markets raised its price target to $22 (Canadian) from $20 and reiterated a "sector performer" rating.
Morgan Stanley downgraded General Motors to "underweight" from "equalweight" and cut its price target to $33 (U.S.) from $49.
Goldman Sachs downgraded Hershey to "sell" from "neutral" with a price target of $90 (U.S.).
Deutsche Bank downgraded Apache to "hold" from "buy" with a price target of $91 (U.S.).
Merrill Lynch upgraded E*Trade to "neutral" from "underperform" and raised its price target to $21 (U.S.) from $19.
FBR Capital upgraded AmerisourceBergen to "outperform" from "market perform" with a price target of $75 (U.S.).
Jefferies initiated coverage on Chevron with a "buy" rating and $140 (U.S.) price target, and on ExxonMobil with a "hold" rating and $96 (U.S.) price target.
UBS downgraded Walter Energy to "sell" from "neutral" and cut its price target to $5 (U.S.) from $8. It also downgraded Arch Coal to "sell" from "neutral" and Alpha Natural Resources to "sell" from "neutral" and cut its price target to $3 from $5.
THIS MORNING'S TOP INVESTING LINKS:
Five warning signs of a stock market bubble, and why this is no year 2000.
The spring is typically a very buoyant time for equity markets.
Why investors should fear the return of the buyback.
Notes from the Value Investing Congress in Las Vegas.
The mobile web is quickly being replaced by apps.
Investing advice from Cambria chief investment officer Mebane Faber.
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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