Before the ring: What all Canadian investors need to know today

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US equity futures advanced sharply on Wednesday morning, as global equities advanced amid conflicting messages about China-China trade relations ahead of this week's G20 summit. Dow futures contracts rose three digits as the bell approached. Jerome Powell, president of the US Federal Reserve, also delivered an important speech. On Bay Street, futures were a bit firmer as crude prices fluctuated and bank profits continued to outperform Royal Bank's expectations. The Canadian dollar was weaker, hovering just above 76 US cents.

In one night, global equities measured by the MSCI All-Country Index reached their best level in about two weeks after Larry Kudlow, White House economic adviser, said US President Donald Trump was ready to conclude an agreement on trade issues with China when he met with Chinese President Xi Jinping. at the G20 summit. Mr. Kudlow stated that Mr. Trump had told councilors that "in his opinion, it is quite possible that an agreement can be reached and that he is open to that." This comes just days after Trump said it was "highly unlikely", the United States would delay the rise in tariffs on imports from China.

"Conflicting commercial headlines are fueling market volatility in anticipation of this week's G20 meeting," said Jasper Lawler, head of research at London Capital Group. "The markets are basing their hopes on the summit and the parallel meetings between President Xi and Trump, as the last opportunity to advance trade negotiations this year."

"Asian markets did not need to be told twice that Larry Kudlow saw a trade deal between the United States and China as an open opportunity. Asian equities rose, with risk being dominated. The Japanese yen continued to flow from its safe haven currency »

He noted that the yen had now extended its losses for the third session, with the US dollar being the currency of choice in the markets.

On Bay Street, Royal Bank reported earnings per share of $ 2.20 in the fourth quarter, up 17% from the prior year and exceeding market expectations of a close $ 2.12.

The Bank of Nova Scotia on Tuesday released its bank profit with a reported earnings per share of $ 1.77, slightly lower than badysts' $ 1.79 forecast.

Investors will also have an eye on the shares of Alimentation Couche-Tard Inc. at the opening of the markets. The Quebec-based convenience store operator has exceeded badysts' forecasts. Excluding non-recurring items, the company reported earnings per share of 84 cents, up from 80 cents last year and 82 cents expected by badysts.

On Wall Street, investors are waiting for statements by Federal Reserve Chairman Jerome Powell. He speaks at the New York Economic Club later in the day. Earlier this month, Powell was generally satisfied with the US economic performance. But he also raised concerns, including slowing global economic growth. Powell's appearance on Wednesday will also be tainted by Trump's harsh criticism of rising interest rates. According to Trump, quoted by the Washington Post this week, "I was not even happy with my selection of Jay."

Overseas, the European markets have mixed after a firmer start. The pan-European STOXX 600 rose 0.14% in morning trading. The British FTSE 100 was down 0.16%. The German DAX rose by 0.12% and the French CAC 40 by 0.37%.

In Asia, markets posted an upbeat rise overnight from the G20 summit. Japan's Nikkei rose 1.02%. Hong Kong's Hang Seng gained 1.33%. The Shanghai Composite Index rose 1.05%.

Basic products

Crude prices have fluctuated, Brent exceeding $ 60 a barrel overnight before giving back some gains. Market hopes that OPEC and its allies cut production early in December helped boost prices, even though a report of an increase in US crude inventories weighed on investor sentiment . The range of days on Brent to date is between 59.84 and 61.27 US dollars, with the best levels seen in the early hours of yesterday, before sliding to the approach of the day. 39, opening of the North American opening. West Texas Intermediate was slightly lower and was currently in the range of 51.36 USD to 52.56 USD.

The American Petroleum Institute announced Tuesday night that US inventories had risen by 3.45 million barrels, which was above market expectations. David Madden, an badyst at CMC Markets, said the US Energy Information Administration is releasing its weekly report later Wednesday morning, and dealers expect stockpiling of about 769,000 barrels. At present, he says, distributors worry about an oversupply, with Saudi productions at record levels and an increase in inventories in the United States. This leaves the December 6 OPEC meeting in the spotlight.

"The OPEC is scheduled to meet next week and they are about to announce a reduction in production, but since Saudi Arabia is under pressure from President Trump, some dealers are doubtful the magnitude of the potential reduction, "said Mr. Madden.

In gold, prices were just above their lowest level in two weeks before Powell's remarks as the US dollar posted recent gains. At the start of trading in Europe, spot gold declined 0.1% to $ 1,213.62 per ounce. The price of gold reached $ 1,211.36, its lowest level since Tuesday, November 15th. US gold futures remained stable at US $ 1,213.20.

"Gold remains a scenario based on the US dollar," said Stepehn Innes, an badyst at OANDA. "And, in the face of stock market downside risk, favor gold buying on geopolitical bottoms and hedges. take place at the end of the year and perhaps beyond, constitutes a significant adverse wind for prices ".

Currencies and obligations

The Canadian dollar languished near the 76 US dollar mark while its US counterpart kept its recent gains ahead of US President Fed Chairman Jerome Powell's lunchtime speech. Until now, the range of days on the loonie ranged from 75.01 to 75.24 US cents, with the lowest reaches being observed in the pre-dawn period. Elsa Lignos, RBC Global Head of Currency Strategy, said the move was a result of "the strength of the US dollar and the widening of the two-year US-US dollar spread. ".

The US dollar, meanwhile, rose for a fourth session early Wednesday. Increased trade tensions have pushed investors to secure safe currency. A lunchtime speech by Mr. Powell is at the center of the debate. Compared to a basket of other currencies, the US dollar index reached 97.39, its best level in two weeks and nearing its peak of 2018, before falling back somewhat when the euro and the pound sterling have regained their footing.

"Powell will be closely watched given the market's focus on the Fed's policy / discourse, but we think it's highly unlikely that it will alter its very balanced position with respect to the background and prescription of gradual rate increases, "Ms. Lignos said. "He may have a question about political pressure. Overnight, Trump told an interviewer that he was "not even a little happy" with Powell and that the Fed's policy was hurting the economy – nothing new, but new criticism (Trump added that he had an instinct and that my instinct tells me more sometimes than anyone else's brain can ever tell me "))"

Prior to the Fed's comments, the yield on the 10-year US note was just under 3.052%. The 30-year note yield was also below 3.308 per cent.

Stocks set to see the action

From Canada Ensign Energy Services Inc. This hostile bid was presented to 56.38% of the shares of Trinidad Drilling Ltd., resulting in the disappearance of the rival bidder, Precision Drilling Corp, and the resignation of Trinidad's top executives. The petroleum service provider stated that the proposed actions had met the minimum legal requirement of its $ 947 million offer. Ensign now holds 66.18% of Trinidad's shares, including its previously held interest. In August, Ensign launched its bid after Trinidad completed its strategic review that began in February. In October, the North American drilling company Precision proposed a $ 1.03 billion contract. Trinidad's board of directors rejected the cash offer of $ 1.68 per Ensign share and instead urged shareholders to accept an all-share offer from Precision. Trinidad declared separately Tuesday that its three top leaders have resigned voluntarily and that the board has been replaced by five candidates for president.

Tiffany and company Missed estimates of Wednesday's comparable quarterly sales, penalized by lower-than-expected spending by Chinese tourists in its US and Hong Kong stores. Tiffany's comparable store sales, excluding the impact of foreign exchange, increased 3% while badysts expected an average of 5.3%, according to Refinitiv's IBES data. The company's net income fell to $ 94.9 million, or 77 cents per share, in the third quarter ended Oct. 31, from $ 100.2 million, or 80 cents per share, a year earlier. Tiffany shares fell by 10% in pre-market trading.

Salesforce.com Inc Easily beat badysts' expectations for quarterly earnings and forecasted revenue for 2020 ahead of expectations on Tuesday, as more and more companies turn to cloud services. The company's shares rose 8% in prolonged trading, which should add to their gain of about 25% this year. Salesforce's results are expected to build on other cloud computing stocks, which caused a shock earlier this month due to concerns over peak demand. According to research firm IDC, Salesforce remained the global market leader in customer relationship management in the first half of 2018, with a market share of 20.3%, but faces increasing competition from Microsoft Corp. Oracle and SAP. Salesforce's shares grew by almost 9% in pre-market trading.

Health insurer Humana Inc announced on Wednesday that it was expecting a larger drop in the number of its members for its prescription drug plans in 2019, while it was sticking to its pricing plans in an extremely competitive market. The company is now expecting a fall of 750,000 to 800,000 members against 500,000 members. The insurer also reiterated its adjusted earnings guidance of about 14.40 USD per share for 2018. Analysts were expecting a forecast of 14.43 USD per share, according to the IBES data from Refinitiv.

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Wednesday's small-cap stocks to watch

Economic News

US GDP grew 3.5% per year in the third quarter, which has not been revised in the past and in line with market expectations. GDP grew by 4.2% a year in the second quarter.

(10 am ET) New home sales in the United States for October. The Street expects an annualized rate increase of 5.2%.

(10:00 am, Eastern time). Richmond Fed US Manufacturing Index for November.

Jerome Powell, Fed President, US, speaking to the Economic Club of New York about the Fed's financial stability monitoring framework.

Reuters and the Canadian press