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Equities

Canada’s main stock index fell at the open Thursday with cannabis shares pulling back after recent gains. South of the border, major U.S. indexes traded near record levels with investors betting that more stimulus could be in the offing to support the U.S. economy.

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At 9:33 a.m. ET, the Toronto Stock Exchange’s S&P/TSX composite index was down 28.28 points, or 0.15%, at 18,429.5.

The Dow Jones Industrial Average rose 28.7 points, or 0.09%, at the open to 31466.49. The S&P 500 rose 6.5 points, or 0.17%, at the open to 3916.4, while the Nasdaq Composite rose 72.7 points, or 0.52%, to 14045.214 at the opening bell.

“Investors are waiting for the next big catalyst to propel stocks to new highs,” Axi market analyst Milan Cutkovic said. "

“The economic calendar for the coming days is looking light and market participants will likely shift their focus back to the stimulus negotiations in Washington D.C. as well as the global vaccination efforts.”

On Wednesday, Mr. Powell underscored the central bank’s commitment to reducing unemployment. Speaking to the Economic Club of New York, he also signalled that the Fed isn’t considering raising its key short-term interest rate from near zero or reducing the size of bond purchases.

“The Fed won’t even consider removing stimulus until the country is really through the pandemic. Lately there have been growing concerns that higher inflation is in the pipeline but Mr. Powell said that an increase in inflation readings in the months ahead won’t mean much in terms of influencing policy,” CMC Markets analyst David Madden said.

On Thursday, earnings and economics will be a key driver on Wall Street.

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U.S. investors got a weekly reading on the employment market. Weekly jobless claims edged down to 793,000 from a revised 812,000. Economists had been expecting the latest number to come in closer to 757,000.

On the earnings front, Kraft Heinz and PepsiCo reported before the start of trading. Walt Disney Co reports after the close.

In this county, investors got results from Bombardier, Cineplex and Telus among others.

Ahead of the opening bell, Bombardier said on it would cut about 1,600 jobs as the COVID-19 pandemic weighs down aircraft demand. The Montreal-based company reported a 19.7-per-cent decline in business aircraft deliveries in 2020. Bombardier also said it would end production of the Learjet. Bombardier shares were down about 10 per cent in early trading in Toronto.

After Wednesday’s close, Manulife Financial Corp. said fourth-quarter profit rose 45 per cent from a year ago, as gains from interest rates and bond sales offset lower volumes of new business during the COVID-19 pandemic last year. The insurer and financial services company says its net income attributed to shareholders was $1.78-billion in the fourth quarter of 2020, up from $1.23-billion in the same period of 2019.

Shares of Inter Pipeline Ltd. shot up more than 30 per cent early trading after Brookfield Infrastructure Partners LP has launched a hostile takeover bid for the company. Brookfield Infrastructure currently holds securities that amount to a 19.65-per-cent stake in the energy infrastructure company and approached its board about a full takeover last fall, but was ultimately rebuffed, The Globe’s Tim Kiladze reports.

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In a statement, Brookfield said Wednesday the talks were “positive in spirit,” but Inter Pipeline believed the company has an “intrinsic value far in excess of our assessment, largely driven by a more optimistic outlook of future growth and a recovery of commodity prices in excess of current market expectation.”

Overseas, major European markets were mostly higher. The pan-European STOXX 600 rose 0.38 per cent by afternoon. German’s DAX gained 0.72 per cent. Britain’s FTSE 100 slid 0.04 per cent while France’s CAC 40 gained 0.03 per cent.

In Asia, trading was muted with a number of markets closed for holidays. Hong Kong’s Hang Seng rose 0.45 per cent.

Commodities

Crude prices pulled back from recent highs in early going with concerns about the impact of COVID-19 lockdowns on demand tempering sentiment.

The day range on Brent is US$60.95 to US$61.25. The range on West Texas Intermediate is US$58.17 to US$58.47. Both benchmarks had recorded more than week of straight gains heading into Thursday’s session.

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Early Thursday, the International Energy Agency cautioned that global supply continues to outstrip demand as a result of restrictions put in place to curb the spread of the novel coronavirus. However, it also said that the rollout of vaccines should help the recovery in demand.

“Taking note of the pause in other markets, the mild price reversion could be nothing more sinister than the oil rally pausing for a breath after hitting new 12-month high,” Axi chief market strategist Stephen Innes said.

Prices drew some support from new figures from the U.S. Energy Information Administration showing that U.S. crude stockpiles fell for a third consecutive week last week. The EIA said inventories fell by 6.6 million barrels to 469 million barrels last week, the lowest level since march. Analysts had been expecting to see an increase in stock piles.

In other commodities, gold edged lower.

Spot gold fell 0.3 per cent to US$1,837.13 per ounce, after hitting a more than one-week high on Wednesday.

U.S. gold futures slipped 0.3 per cent to US$1,837.40.

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Currencies

The Canadian dollar was higher in early going as the U.S. dollar slid against a group global counterparts after bouncing off two-week lows overnight.

The day range on the loonie is 78.67 US cents to 78.88 US cents.

There were no major Canadian economic reports due Thursday.

On global markets, the U.S. dollar index was lower on the day at 90.411, having recovered some overnight losses as European markets opened, according to figures from Reuters.

The euro was little changed against the U.S. dollar, at US$1.2121.

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The Australian dollar was up 0.3 per cent at 0.7743 versus the U.S. dollar, having come close to a two-week high overnight.

The British pound was little changed at US$1.3825, a below the three-year high of US$1.3865 reached on Wednesday.

More company news

Cineplex Inc. reported a fourth-quarter loss of $230.4-million as restrictions to slow the spread of the pandemic were tightened and theatres closed. The movie theatre company says the loss amounted to $3.64 per diluted share for the quarter ended Dec. 31 compared with a profit of $3.5-million or six cents per diluted share in the last three months of 2019. Revenue totalled $52.5-million, down from $443.2-million a year earlier.

Restaurant Brands International Inc posted quarterly profit below Wall Street estimates, dented by tepid demand for its Tim Hortons coffee as customers avoided stepping out amid fresh restrictions imposed to tackle COVID-19 cases. Comparable sales at Tim Hortons sank 11% in the quarter, hurt in part by temporary dining room closures and curfews in parts of Canada as rising COVID-19 cases deterred diners from stepping out to get their morning bagels.

PepsiCo Inc said on Thursday it expects organic revenue to grow in 2021 on hopes that consumers would return to pre-pandemic lifestyles as economies reopen and COVID-19 vaccinations roll out. The company said it expects mid-single digit rise in annual organic revenue and a high-single digit increase in adjusted earnings. PepsiCo’s net revenue rose 8.8% to $22.46-billion in the fourth quarter ended Dec. 26, above market expectation of $21.8-billion, according to IBES data from Refinitiv.

Kraft Heinz Co said that it plans to sell its nuts business - including most Planters and Corn Nuts products - to Hormel Foods Corp for $3.35-billion. Kraft Heinz shares were up 2% before the bell. The deal, which is expected to close in the first half of 2021, includes global intellectual property rights to the brands, subject to existing third-party licenses.

Economic news

(8:30 a.m. ET) U.S. initial jobless claims for week of Feb. 6.

With Reuters and The Canadian Press

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