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Equities

Canada’s main stock index gained in early trading Thursday, helped by financial stocks as bank earnings continue to roll in. On Wall Street, indexes saw a mixed start with volatility continuing to weigh on investor sentiment.

At 9:32 a.m. ET, the Toronto Stock Exchange’s S&P/TSX composite index was up 14.78 points, or 0.07 per cent, at 20,479.38.

The Dow Jones Industrial Average rose 54.21 points, or 0.16 per cent, at the open to 34,076.25.

The S&P 500 opened lower by 8.31 points, or 0.18 per cent, at 4,504.73, while the Nasdaq Composite dropped 72.23 points, or 0.47 per cent, to 15,181.82 at the opening bell.

“The risk sentiment is sour,” Ipek Ozkardeskaya, senior analyst with Swissquote, said.

“Market mood is hit by two fundamentally ugly news [stories]: first, the uncertainties around the new Omicron strain, and second: the expectation that the Federal Reserve (Fed) would pull away its support faster to tame the rising inflationary pressures.”

She noted the VIX index, which measures volatility, spiked to 30 this week, its highest level since the start of the year and just below levels seen in October 2020.

“It’s unlikely we get to the pandemic levels, but of course, the fact that the markets will soon be left to their own fundamentals is a problem for a market where valuations went through the roof,” she said.

In this country, bank earnings continue to roll in. Canadian Imperial Bank of Commerce and Toronto-Dominion Bank report before the start of trading.

TD Bank said adjusted net income rose to $3.87-billion, or $2.09, in the fourth quarter ended Oct. 31, from $2.97-billion, or $1.60 cents, a year earlier. Analysts on average had expected a profit of $1.96 a share, according to IBES data from Refinitiv. The bank also raised its dividend by 10 cents for the quarter ending Jan. 31, 2022 from 79 cents for each of the last six quarters. TD shares were up more than 3 per cent shortly after the opening bell in Toronto.

CIBC raised its dividend to $1.61, from $1.46 in each of the last six quarters. Net income excluding one-off items rose to $1.57-billion, or $3.37 per share, in the three months ended Oct. 31, from $1.28-billion, or $2.79 per share, a year earlier. Analysts on average had estimated the company to report $3.53 a share, according to IBES data from Refinitiv. CIBC stock was down more than 2 per cent in early trading.

The Globe’s James Bradshaw reports that on Wednesday RBC and National Bank reported higher fourth-quarter profits and large dividend hikes but still failed to meet Bay Street’s expectations, as narrowing profit margins and lower trading activity led to lacklustre revenues.

Overseas, major European markets were down at midday.

The pan-European STOXX 600 was down 1.48 per cent. Britain’s FTSE 100 fell 0.78 per cent. Germany’s DAX and France’s CAC 40 lost 1.59 per cent and 1.45per cent, respectively.

In Asia, Japan’s Nikkei finished down 0.65 per cent. Hong Kong’s Hang Seng gained 0.55 per cent.

Commodities

Crude prices surrendered early gains after OPEC+ members agreed to go ahead with plan production increases in January.

The day range on Brent is US$68.73 to US$70.70. The range on West Texas Intermediate is US$65.41 to US$67.36. Brent fell 0.5 per cent on Wednesday while WTI lost 0.9 per cent.

The OPEC+ group concluded with the group agreeing to stick to their existing policy of monthly oil output increases despite uncertainty brought on by the new coronavirus variant.

fears that a U.S. release from crude reserves and the new coronavirus variant would lead to a new oil price rout. OPEC+ has an agreement in place to add 400,000 barrels per day a month to production as it unwinds last year’s record supply cuts.

“I still think the meeting has come too soon,” OANDA senior analyst Craig Erlam said.

“I’m not sure there’s enough at this stage to make an informed judgment and if they had, by their own admission, factored in another wave this winter, then there should be no need to adjust at this stage.”

In other commodities, gold prices fell as hawkish comments from Fed chair Jerome Powell offset uncertainty over the course of the pandemic.

Spot gold fell 0.7 per cent to US$1,769.86 per ounce early Thursday morning. U.S. gold futures dropped 0.8 per cent to US$1,770.90.

Currencies

The Canadian dollar inched higher in early going while its U.S. counterpart was treading water against a group of global counterparts.

The day range on the loonie is 77.95 US cents to 78.27 US cents.

There were no major Canadian economic releases due Thursday. Markets will get a reading on November employment in this country on Friday morning.

On world markets, the U.S. dollar index, which tracks the greenback against six major currencies, was little changed at 96.035.

The euro was steady versus the U.S. dollar at US$1.13205, according to figures from Reuters.

The Japanese yen, which strengthened over the past week as investors sought safe havens, lost some of those gains versus the U.S. dollar, falling 0.4 per cent to 113.26 yen.

Britain’s pound rebounded slightly, rising above US$1.33.

More company news

Apple Inc has told its parts suppliers that demand for the iPhone 13 lineup has slowed, Bloomberg News reported, citing people familiar with the matter, signaling that some consumers have decided against trying to get the hard-to-find item. The company had earlier cut production of iPhone 13 by as many as 10 million units due to a global chip shortage, but now it has informed vendors that those orders may not materialize, the report said.

China’s aviation authority on Thursday issued an airworthiness directive on the Boeing Co 737 MAX that will help pave the way for the model’s return to service in China after more than two and a half years. The directive instructs airline operators on the revisions required before the MAX returns to service, although it does not specify when China will lift a ban on the MAX in its airspace.

Economic news

(8:30 a.m. ET) U.S. initial jobless claims for week of Nov. 27.

With Reuters and The Canadian Press