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 extended modest early gains after the arrival of May jobs data that came in largely as expected for both countries. S&P 500 futures are up about nearly 0.3 per cent after trading about 0.1 per cent higher prior to the data. Bond yields ticked higher.
The U.S. Federal Reserve is in a somewhat predetermined path on policy right now, with plans to continue tapering its monthly bond-buying program and hold off any hike in interest rates until at least mid-2015. That's likely limiting market reaction to the U.S. nonfarm payrolls report, although it contained few surprises, with a net 217,000 new jobs created and the unemployment rate holding steady. We're now well past seeing data from the unusually brutal winter period, so stocks are vulnerable to a selloff should the much-anticipated bounce-back in economic conditions fail to arrive.
European markets have a firm bid to them this morning, as traders absorb Thursday's ECB policy moves that included an easing in its key interest rate as well as preparations to start the purchase of asset-backed securities - a kind of quantitative easing type program. On the data front in Europe today, April industrial output for Germany was weaker than expected, but the country's exports grew at their strongest pace in nearly two years during the month.
The Canadian jobs report, notoriously volatile in recent months, was surprising in one sense: it came in largely as forecast this time around. As such, there was little reaction in the Canadian dollar and bond markets.
On the TSX, Air Canada and Cameco could see some support today from the sell side, as both stocks saw analyst upgrades. And the TSX materials sector could see further weakness today as copper prices are aggressively being sold off. There are reports that a Chinese port, Qingdao, has halted shipments of aluminum and copper because of an investigation into loan irregularities involving stocks in warehouses. Global trading houses have been left scrambling to check exposure to the probe.
We detail that and much more below.
Futures: S&P 500 +0.26 per cent; Dow +0.28 per cent; Nasdaq +0.19; S&P/TSX +0.11 per cent
Hong Kong's Hang Seng -0.69 per cent
Shanghai composite index -0.53 per cent
Japan's Nikkei -0.02 per cent
London's FTSE 100 +0.30 per cent
Germany's DAX +0.26 per cent
France's CAC 40 +0.36 per cent
WTI crude oil (Nymex Jly) +0.25 per cent at $102.74 (U.S.) a barrel
Gold (Comex Aug) -0.08 per cent at $1,252.40 (U.S.) an ounce
Copper (Comex Jly) -1.49 per cent at $3.04 (U.S.) a pound
Canadian dollar at 91.42 (U.S.), down 0.0011
U.S. dollar index up 0.08 at 80.45
U.S. 10-year Treasury yield 2.60 per cent, up 0.01
Canada created 26,000 net new jobs in May, driven by part-time employment. Street had expected 21,300. The unemployment rate rose to 7 per cent from 6.9 per cent.
U.S. nonfarm payrolls for May rose by a net 217,000 jobs, close to expectations for 219,000 and down from 288,000 net new jobs in April. The unemployment rate held steady at 6.3 per cent; Street had expected it to drift higher to 6.4 per cent.
STOCKS TO WATCH:
Hertz Global Holdings shares are down 8 per cent in the premarket after the company said it needs to restate financial results over accounting issues.
National Bank Financial upgraded Air Canada to "outperform" and raised its price target to $12 (Canadian) from $8.50. And RBC Dominion Securities raised its target to $17 from $12 and reiterated an "outperform" rating.
Canaccord Genuity upgraded Cameco to "hold" from "sell" but cut its price target to $20 (Canadian) from $22.
Canaccord Genuity downgraded Capstone Mining to "outperform" from "strong buy" and cut its price target to $3.75 (Canadian) from $4.
Desjardins Securities hiked its price target on Saputo to $64 (Canadian) from $58 and affirmed its "buy" rating.
RBC Dominion Securities hiked its price target on AutoCanada to $91 (Canadian) from $74 and affirmed a "sector perform" rating.
Merrill Lynch upgraded Joy Global to "buy" from "neutral" with a price target of $70 (U.S.).
THIS MORNING'S TOP INVESTING LINKS:
Bill Gross says he doesn't even own a cell phone.
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For instant headlines on breaking economic and corporate news in the premarket, follow Darcy Keith on Twitter at @eyeonequities.