Equities
Canada’s main stock index saw a subdued start Wednesday as strength in consumer staples stocks helped offset weakness in materials shares. On Wall Street, key indexes saw modest early gains as markets look to add to a multiday winning streak.
At 9:30 a.m. ET, the Toronto Stock Exchange’s S&P/TSX composite index was unchanged at 19576.14.
In the U.S., the Dow Jones Industrial Average rose 33.32 points, or 0.10 per cent, at the open to 34,185.92.
The S&P 500 opened higher by 5.99 points, or 0.14 per cent, at 4,384.37, while the Nasdaq Composite gained 20.36 points, or 0.15 per cent, to 13,660.22 at the opening bell.
“Last week’s Federal Reserve meeting and indications of a slowdown in the U.S. job market have led many investors to believe that the central bank’s cycle of interest rate hikes is ending,” Stephen Innes, managing partner with SPI Asset Management, said.
“Nonetheless, on Tuesday, several Federal Reserve officials emphasized that the central bank might still consider raising interest rates...We can only hope the market won’t panic at every mention of inflation by central bankers. Otherwise, the upcoming decade will be challenging.”
On Wednesday morning, markets will hear from Federal Reserve chair Jerome Powell, who is scheduled to deliver opening remarks at the Fed’s Division of Research and Statistics Centennial Conference.
In Canada, investors will get the deliberations from the Bank of Canada’s latest policy meeting, which resulted in the central bank holding steady on borrowing costs for the second time in a row.
“The Bank of Canada’s summary of deliberations for the October policy decision are released [this afternoon],” Shaun Osborne, chief FX strategist with Scotiabank, said. “This is not usually a market moving event but if there is any push back on the idea of early rate cuts, the Canadian dollar may perk up a bit.”
On the corporate side, TC Energy reported results this morning. Suncor reports earnings after the close of trading.
Ahead of the opening bell, TC Energy posted an adjusted profit of $1.00 per share for the quarter ended Sept. 30, compared with the average analyst estimate of $0.97 per share, according to LSEG data.
On Tuesday, Indigo Books & Music Inc. reported a net loss of $22.4-million or 80 cents a diluted share in its second quarter, compared with a net loss of $15.9-million or 57 cents a year earlier. Revenue for the Toronto-based retailer totalled $206.9-million, down from $236.2-million a year earlier. The results were released after the close of trading.
On Wall Street, markets will get earnings from Walt Disney Co. after trading ends for the day.
Overseas, the pan-European STOXX was up 0.03 per cent by midday. Britain’s FTSE 100 added 0.05 per cent. Germany’s DAX fell 0.10 per cent and France’s CAC 40 rose 0.05 per cent and 0.21 per cent, respectively.
In Asia, Japan’s Nikkei closed down 0.33 per cent. Hong Kong’s Hang Seng fell 0.58 per cent.
Commodities
Crude prices continued to slide in early trading after hitting three-month lows yesterday with demand concerns weighing on sentiment.
The day range on Brent was US$81.26 to US$81.96 in the early premarket period. The range on West Texas Intermediate was US$76.51 to US$77.53. Both benchmarks hit their lowest levels since July on Tuesday.
“The risk of a sudden jump due to supportive geopolitical news is live, but if the Gaza war, the Iranian warnings that the war could escalate and spill to the region, and OPEC and Russia’s reminder that they will keep the production levels tight couldn’t prevent this month’s selloff, the slowing demand rhetoric will continue to outweigh the supply concerns and keep the market in the bearish waters,” Swissquote senior analyst Ipek Ozkardeskaya said.
On Tuesday, the U.S. Energy Information Administration said it expects crude production to rise slightly this year but also forecast a decline in demand.
EIA projected crude production will rise to 12.9 million barrels per day (bpd) in 2023, compared with its previous estimate of 12.92 million bpd, Reuters reported. Petroleum and other liquid fuels consumption is to fall to 20.1 million bpd in 2023, compared with a previously forecast rise in consumption.
Elsewhere, the American Petroleum Institute reported that weekly crude stocks rose by nearly 12 million barrels. The release of more official government figures, normally every Wednesday, has been delayed until next week.
In other commodities, spot gold was little changed at US$1,967.10 per ounce by early Tuesday morning, after hitting its lowest since Oct. 24 on Tuesday. U.S. gold futures were flat at US$1,974.10.
Currencies
The Canadian dollar was lower while its U.S. counterpart extended gains against a group of world currencies into a third day.
The day range on the loonie was 72.49 US cents to 72.71 US cents in the early premarket period. The loonie was up 0.47 per cent against the greenback over the past five days by early Tuesday morning but down more than 1 per cent over the past month.
On world markets, the U.S. dollar index, which touched at seven-week low early this week, rose 0.2 per cent to 105.73 and was on track for a weekly gain.
The euro fell 0.2 per cent to US$1.0674 after figures showed German industrial production fell more than expected in September.
Britain’s pound was down 0.2 per cent at US$1.2264 early Wednesday morning after hitting a seven week high above US$1.24 earlier in the week, according to figures from Reuters.
In bonds, the yield on the U.S. 10-year note was up slightly at 4.583 per cent ahead of the North American opening bell.
More company news
Intact Financial Corp. says it earned $163-million in the third quarter, less than half its earnings a year ago when it brought in $375-million. The company says earnings worked out to 83 cents per share, down from $2.05 during the same quarter last year. It says net operating income per share was $2.10, down from $2.78 a year earlier. Intact says increased catastrophe losses offset the impact of improving underwriting fundamentals, as well as higher earned premiums and investment income. -The Canadian Press
Ebay forecast fourth-quarter revenue and profit below Wall Street estimates on Tuesday and joined other e-commerce platforms in sounding the alarm on weaker-than-expected consumer spending. San Jose, California-based eBay’s shares were down more than 8 per cent in premarket trading. High interest rates and stubborn inflation across major economies in Europe as well as in the United States have further eaten into consumers’ discretionary budgets. -Reuters
CGI Inc. reported a fourth-quarter profit of $414.5-million, up from $362.4-million a year ago, as its revenue rose eight per cent. The technology consulting firm says its profit amounted to $1.76 per diluted share for the quarter ended Sept. 30, up from $1.51 per diluted share a year earlier. Revenue totalled $3.51-billion, up from $3.25-billion in the same quarter last year. CGI says its profit excluding specific items amounted to $1.79 per diluted share compared with $1.56 per diluted share a year earlier. -The Canadian Press
The company says it spent $9 million in its
Economic news
(8:30 a.m. ET) Canadian building permits for September.
(8:30 a.m. ET) U.S. wholesale inventories for September.
(9:15 a.m. ET) U.S. Fed chair Jerome Powell delivers opening remarks at the Fed’s Division of Research and Statistics Centennial Conference.
(1:30 p.m. ET) Bank of Canada’s Summary of Deliberations for the Oct. 25 decision.
With Reuters and The Canadian Press
Terry Weber