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Equities
Canada’s main stock index was largely flat at the start of trading Thursday with gains in energy stocks offset by weakness in mining shares. On Wall Street, the tech-heavy Nasdaq rose in early trading, helped by gains in Nvidia Corp. stock on the back of positive earnings.
At 9:31 a.m. ET, the Toronto Stock Exchange’s S&P/TSX composite index was down 6.67 points, or 0.03%, at 21,646.35.
In the U.S., the Dow Jones Industrial Average fell 29.36 points, or 0.08 per cent, at the open to 35,901.69.
The S&P 500 opened higher by 12.05 points, or 0.26 per cent, at 4,700.72, while the Nasdaq Composite gained 51.82 points, or 0.33 per cent, to 15,973.40 at the opening bell.
“While companies are managing to report solid Q3 numbers, the ability to do so is being tempered by concerns about slimmer margins, and it is this that appears to be prompting an element of profit taking,” Michael Hewson, chief market analyst with CMC Markets U.K., said.
Ahead of the opening bell, investors got the weekly reading on U.S. jobless claims. Claims last week totalled 268,000, roughly in line with forecasts and down 1,000 from the previous week. The latest figure marked lowest level of U.S. jobless claims since the start of the pandemic.
On the corporate side, shares of Nvidia Corp. jumped 11 per cent in early trading after the company forecast fourth-quarter revenue above market forecasts. Nvidia expects revenue of US$7.40-billion, plus or minus 2 per cent, in the quarter, above analysts’ average estimate of US$6.86-billion, according to IBES data from Refinitiv.
In this country, The Globe reports Joe Natale presented the board of Rogers Communications Inc with a list of demands aimed at protecting his authority as CEO, but the board rejected the requests, resulting in his dismissal this week. The board of the telecom and media giant voted on Tuesday night to remove Mr. Natale as chief executive officer and install Tony Staffieri, the company’s former chief financial officer, in the role on an interim basis.
Overseas, the pan-European STOXX 600 was down 0.20 per cent around midday. Britain’s FTSE 100 fell 0.29 per cent. Germany’s DAX slid 0.05 per cent while France’s CAC 40 edged up 0.02 per cent.
In Asia, Japan’s Nikkei ended down 0.30 per cent. Hong Kong’s Hang Seng fell 1.29 per cent.
Commodities
Crude prices steadied after seeing early declines following reports that China was moving to release strategic reserves.
The day range on Brent is US$79.28 to US$80.33. The range on West Texas Intermediate is US$77.08 to US$78.44. Both benchmarks touched their lowest levels since last month in early trading.
The declines came as China’s state reserve bureau told Reuters it was working on a release of its crude oil reserves.
That news came as the agency reported that the United States is asking big consuming nations to look at the possibility of a coordinated inventory release to offset high energy costs.
“A potential coordinated effort between the world’s two largest economies to release crude reserves sent oil prices lower,” OANDA senior analyst Ed Moya said in a note.
“Inflationary pressures are heating up everywhere and that has some investors nervous about the short-term growth outlook which could also translate to softer crude demand,” he noted.
In other commodities, gold prices traded in a narrow band as markets wait for further indication of how quickly the Federal Reserve could act to pullback stimulus.
Spot gold was little changed at US$1,864.50 per ounce, while U.S. gold futures fell 0.2 per cent to $1,866.90.
Currencies
The Canadian dollar was slightly higher in early going as its U.S. counterpart pulls back somewhat from its recent 16-month high against a basket of world currencies.
The day range on the loonie is 79.20 US cents to 79.42 US cents.
“The BoC has signalled that it may raise rates around mid-2022, but the markets have priced in a hike for March of next year,” OANDA market analyst Kenny Fisher said.
“Something will have to give, and with inflation showing no signs of easing, the central bank may have to bring forward its timeline for a rate hike, which would support the Canadian dollar.”
There were no major Canadian economic releases due Thursday. Investors will get September retail sales on Friday. Markets are expecting to see a decline for the month of about 1.9 per cent.
On world markets, the U.S. dollar index, which measures the currency against a basket of six rivals, hit its highest since mid July 2020 on Wednesday at 96.226 was last at 95.694, down 0.1% on the day, according to figures from Reuters.
The euro, which has been trading near a 16-month low, rose 0.1 per cent to US$1.1334.
New Zealand’s dollar rose 0.6 per cent to US$0.7041 after a central bank survey showed inflation is expected to rise in the fourth quarter. The Australian dollar hit a six-week low of US$0.7263 but rebounded alongside the New Zealand dollar’s rally and was last up 0.3 per cent at US$0.7286.
More company news
Macy’s Inc raised its full-year sales forecast on Thursday, easing fears that the department store chain would struggle with product shortages during the crucial holiday season. The company said it expected full-year net sales of US$24.12-billion to US$24.28-billion, compared with a previous forecast of US$23.55-billion to US$23.95-billion.
China’s Alibaba Group Holding Ltd on Thursday missed market expectations for second-quarter revenue, as consumption in the country slowed and its e-commerce business took a hit from supply chain constraints. Revenue rose 29% to 200.69 billion yuan (US$31.44-billion) in the quarter ended Sept. 30. Analysts on an average had expected revenue of 204.93 billion yuan, according to Refinitiv data.
Tesla is recalling 7,600 vehicles in the United States because the driver’s air bag cushion may tear during deployment, the National Highway Traffic Safety Administration said Thursday. The recall covers some 2021 Model X and Model S vehicles, the auto safety agency said. Owner notification letters are expected to be mailed Jan. 7.
Cisco Systems Inc missed Wall Street expectations for first-quarter revenue on Wednesday, hurt by slackening demand for on-campus network hardware as businesses move operations to the cloud. Revenue for the quarter ended Oct. 30 was US$12.90-billion. Analysts on average had expected revenue of US$12.98-billion, according to IBES data from Refinitiv.
Economic news
(8:30 a.m. ET) Canadian international securities transactions for September.
(8:30 a.m. ET) U.S. initial jobless claims for week of Nov. 13.
(8:30 a.m. ET) U.S. Philadelphia Fed Manufacturing Activity for November.
(10 a.m. ET) U.S. leading indicator index for November.
(11 a.m. ET) U.S. Kansas City Fed Manufacturing Index for November.
With Reuters and The Canadian Press
Terry Weber