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Equities

Canada’s main stock index opened higher Friday and looked set for a weekly gain. On Wall Street, key indexes were muted in early trading after rallying earlier in the week on growing optimism about the Federal Reserve’s future course on monetary policy.

At 9:31 a.m. ET, the Toronto Stock Exchange’s S&P/TSX composite index was up 84.13 points, or 0.42 per cent. The index was up more than 2 per cent heading into Friday’s session.

In the U.S., The Dow Jones Industrial Average rose 19.35 points, or 0.06 per cent, at the open to 34,964.82.

The S&P 500 opened higher by 1.31 points, or 0.03 per cent, at 4,509.55, while the Nasdaq Composite dropped 12.24 points, or 0.09 per cent, to 14,101.44 at the opening bell.

“Despite the mixed closing, Wall Street is poised for its best month in a year, fueled by optimism that the Federal Reserve may adopt a more accommodative stance on interest rates,” Stephen Innes, managing partner with SPI Asset Management, said.

“Treasury yields further declined as additional reports supported the belief that the economy might be cooling, potentially reducing the need for interest rate hikes to temper its growth.”

Early Friday, shares of U.S. retailer Gap spiked nearly 30 per cent shortly after the opening bell in New York after the company topped analyst’s forecasts in the latest quarter. Gap posted an adjusted profit of 59 US cents a share, blowing past estimates of 19 US cents. Its net sales of US$3.78 billion beat Wall Street expectations of US$3.60 billion, helped by strength at the company’s Old Navy banner.

In Canada, The Globe’s Irene Galea reports BCE Inc.’s Bell Canada is asking the Federal Court for leave to appeal a recent decision by Canada’s telecom regulator, saying the body committed an error of law and exceeded its jurisdiction when it ordered Bell to share access to its fibre network with competitors. Bell is also seeking an interim stay of the decision pending the court’s ruling on the appeal request.

Overseas, the pan-European STOXX 600 was up 0.97 per cent by afternoon. Britain’s FTSE 100 advanced 0.96 per cent. Germany’s DAX and France’s CAC 40 were up 0.87 per cent and 0.92 per cent, respectively.

In Asia, Japan’s Nikkei finished up 0.48 per cent. Hong Kong’s Hang Seng lost 2.12 per cent, weighed down by declines in Alibaba shares.

Commodities

Crude prices were firmer but still on track for a fourth consecutive weekly loss following sharp declines in yesterday’s session on the back of demand concerns.

The day range on Brent was US$77.28 to US$78.21 in the early premarket period. The range on West Texas Intermediate was US$72.75 to US$73.67. Crude prices fell about 5 per cent on Thursday, touching a four-month low.

For the year to date, Brent is down more than 4 per cent while WTI is off about 5 per cent.

“There are clearly concerns around demand going into next year, particularly around China, which OPEC this week sought to relieve, to no avail,” OANDA senior analyst Craig Erlam said.

“The recent trend may make it difficult for Saudi Arabia and Russia to allow their unilateral cuts to expire at the end of the year, which is something markets may be gradually pricing in.”

In other commodities, gold was up and headed for its first weekly gain in three as markets increasingly bet that the U.S. Federal Reserve is done with its current rate-hike cycle.

Spot gold was up 0.2 per cent at US$1,985.29 per ounce by early Friday morning, after hitting its highest since Nov. 6 on Thursday. U.S. gold futures were steady at $1,985.29.

“Momentum still looks healthy and gold bulls may have sights set on $2,000 once more,” Mr. Erlam said in a recent note.

“Recent data has been very favorable for gold, it will be interesting to see whether that will be enough to propel it above this big psychological zone.”

Currencies

The Canadian dollar was up while its U.S. counterpart lost altitude against a group of world currencies and looked set for a weekly decline amid increasing expectations that interest rates won’t need to rise further.

The day range on the loonie was 72.61 US cents to 72.84 US cents in the early premarket period. The Canadian dollar was up about 0.54 per cent against the greenback over the last five days as of early Friday morning.

On world markets, the U.S. dollar index, which weighs the greenback against a group of world currencies, was down 0.14 per cent in the early premarket period. The index has fallen about 1.6 per cent over the last five days after the latest U.S. inflation figures fuelled optimism that the Fed wouldn’t need to continue raising interest rates.

Elsewhere, at $1.0854 to the euro, the U.S. dollar has lost 1.6 per cent for the week, its steepest fall since mid-July, Reuters reported Friday morning. The greenback is also down 1.6 per cent for the week to 0.8882 Swiss francs and has lost 0.6 per cent to trade at 150.53 on the yen, the news agency said.

In bonds, the yield on the U.S. 10-year note was lower at 4.404 per cent ahead of the North American opening bell.

Economic news

Canadian Raw Materials Price Index for October (8:30 a.m. ET)

Canadian Industrial Product Price Index for October (8:30 a.m. ET)

Canada’s International Transactions in Securities for September (8:30 a.m. ET)

U.S. housing starts for October (8:30 a.m. ET)

U.S. building permits for October (8:30 a.m. ET)

With Reuters and The Canadian Press

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