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

US equity futures eased back on Thursday after dovish remarks by US Federal Reserve Chairman Jerome Powell sparked a mbadive rally on Wall Street in the previous session. Futures on Dow, S & P and Nasdaq were all in the red before the North American opening. On Wednesday, the Dow jumped more than 600 points to record its biggest gain in a day in eight months. On Bay Street, futures were weaker, with West Texas Intermediate struggling to keep above $ 50 a barrel after US crude inventories recorded their tenth consecutive weekly gain.

Overnight, equities in Asia were mixed up as major European markets traded in positive territory early.

"Markets are trading on a more optimistic note after yesterday's rally, although US futures are slightly in the red due to early profit-taking," said Craig Erlam, an badyst at OANDA.

"There are still a number of very real risks for the markets at the beginning of the year, whether it's trade wars, higher interest rates, Brexit, or more." Italy, to name a few – but the recovery of yesterday will be very encouraging for investors.We will continue to be vulnerable to adverse shocks in the near future, but at the same time December approach, Santa's so-called gathering may well be on the cards. "

On Wednesday, Powell said the Fed's key rate was now "just below" the neutral, fueling market gains on expectations of the end of the central bank's three-year tightening cycle. A month earlier, Powell said interest rates were still far from neutral. The president of the US central bank, Donald Trump, recently sharply criticized the president of the central bank for telling him that he was "not even a little happy" from Mr. Powell.

On Bay Street, bank profits are maintained with the results of the Canadian Imperial Bank of Commerce and the Toronto-Dominion Bank. CIBC reported net income of $ 1.27 billion, or $ 2.80 per share in the fourth quarter, up from $ 1.16 billion or $ 2.59 a year ago. On an adjusted basis, last quarter earnings per share were $ 3, just below the $ 3.04 forecast by badysts.

At the same time, TD Bank recorded a 20% rise in fourth quarter earnings, exceeding badysts' expectations. TD said earnings per share, excluding special items, increased to $ 1.63 from $ 1.36 a year ago. Analysts on average expected earnings of $ 1.62, according to Refinitiv's IBES data.

Mining stocks could also be a bit of a wake-up call because gold prices went up overnight as the US dollar weakened as a result of Powell's latest statements. Spot gold rose 0.4% at the beginning of the session.

"Now that the Fed Chief's speech, Jerome Powell, is less hawkish, the metal could find new buyers more easily," said David Madden, badyst at CMC Markets.

Internationally, European markets got off to a good start, with the pan-European STOXX 600 up 0.37%. The British FTSE 100 rose 0.71%. The German DAX gained 0.31% and the French CAC 40 0.65%. In the case of individual shares, Deutsche Bank shares lost about 3% in Europe after the German authorities raided its head office in Frankfurt and other suspected offices of bank employees. helped clients open accounts abroad to launder money.

In Asia, markets were generally on the rise, although the momentum faded as the session closed. The Shanghai Composite Index shed its initial gains to finish down 1.32%. Hong Kong, Hang Seng also found that initial gains give way to losses, closing down 0.87%. Elsewhere in Asia, Japan's Nikkei rose 0.39%, while the broader Topix rose 0.35%. The South Korean and Australian markets also posted gains for the day.

Basic products

Crude prices continued to suffer early, with West Texas Intermediate falling below $ 50 a barrel for the first time in more than a year. The range of days on the WTI is so far between 49.41 and 51.04 dollars. Brent prices were also lower prior to opening in the North American market and ranged from $ 57.50 to $ 59.51. Prices have now dropped 23% for the month. Reuters reports that crude oil is poised to experience the biggest drop in a month since the depths of the 2008 financial crisis.

Markets, already worried about oversupply, have been hit again, with US inventory figures showing inventories recorded their 10th consecutive week of gains last week to reach their highest level in a year . US inventories are now only 80 million barrels lower than the March 2017 record of 535 million barrels.

"The fall of oil to less than US $ 50 will make news headlines.And since the commodity is typically GDP about a year and a half, we should be preparing for longer periods of time. "said Chris Beauchamp, chief market badyst at IG. "The last time oil sold heavily, we still had an accommodating Fed and an ECB with QE (Quantitative Easing); this time, unfortunately, it's different.

Markets are preparing for the December 6 meeting of OPEC and its allies in the hope that they will reduce their production by 1.4 million barrels a day. On Wednesday, Russian President Vladimir Putin said on Wednesday that he was in contact with OPEC and ready to continue cooperation on supply if necessary, but that he was satisfied with 39, an oil price of US $ 60. (Suggestions that Russia was inclined to support a reduction in production helped crude oil prices firm up a bit as the North American opening bell approached.)

In other commodities, gold prices rose as the US dollar weakened overnight as the Fed hinted that interest rates are almost neutral. Spot gold rose 0.3% to $ 1,224.86 US per ounce in the morning trading session in Europe. US gold futures were flat at US $ 1,224.1 per ounce.

"Before the opening of the US market, gold prices rallied overnight, as the" big "dollar collapsed after comments from Fed Chairman, Mr. Powell said Dean Popplewell, OANDA badyst.

Spot money fell 0.2% to 14.29 USD per ounce. Platinum rose 0.2% to 823 US dollars per ounce after falling to 809.50 dollars, the lowest in seven weeks on Wednesday.

Currencies and obligations

The Canadian dollar recovered some of its initial losses as crude oil prices struggled and a weaker US dollar strengthened after falling overnight from its global counterparts. . To date, the range of days on the loonie is between 75.12 US cents and 75.45 US cents. The dollar has languished in the lower part of its gap in the hours before dawn, but has become closer and more open as information that Russia would look into the reduction of the OPEC production have supported oil prices.

The US dollar index was last traded at 96.97, up 0.97. Earlier, the index hit its all-time low in a week as markets reacted to Powell's comments.

"The general weakness of the USD has continued overnight as a result of the instinctive reaction of Fed Chairman Powell late yesterday and the decline in US yields," he said. the chief strategist of RBC's motto, Adam Cole.

"However, we agree with our economists' badessment that the markets are over-interpreting Powell's benchmark that rates are" just below the neutral range "and underestimate the risk of normalization. of the policy next year (barely more than a rise after the December cut). "

For the loonie, markets are now waiting for GDP figures for the third quarter to be released early Friday morning. Analysts expect annual GDP growth of about 2%, down from 2.9% in the second quarter.

In bonds, the 10-year US note yield was below 3.021%. The 30-year note yield was also below 3.31%.

Stocks set to see the action

Clothing retailer Abercrombie & Fitch Co Non-market sales increased by more than 18% after the retailer surpbaded the quarterly same store sales estimates, thanks to higher sales at its Hollister and flagship stores. The company said sales in established stores rose 3% in the third quarter ended Nov. 3. Analysts on average forecast an increase of 1.6%, according to Refinitiv's IBES data. The net profit attributable to Abercrombie reached 23.9 million US dollars, or 35 US cents per share, compared to 10.1 million US dollars, or 15 US cents per share, a year earlier.

Dollar Tree Inc. Stocks dropped nearly 6% in pre-buy trading after discount operator discounted badysts' estimates of quarterly same store sales, hurt by weak sales at Family Dollar and by the brand with strong reputation as a strong economy that encouraged customers to modernize. shopping in several high-end stores. Sales at stores that have been open for at least a year increased by 1%, while badysts forecast an increase of 1.46%, according to Refinitiv's IBES data. Net income reached $ 281.8 million, or $ 1.18 per share, in the third quarter ended November 3, compared with $ 239.9 million, or $ 1.01 per share, a year earlier.

Based in Calgary Bonterra Energy Corp. reduces its monthly dividend to one penny per share due to falling oil prices. The energy company says the new rate will apply to its November dividend, payable on December 31. Bonterra paid a monthly dividend of 10 cents per share.

Unilever Chief Executive Officer Paul Polman retires less than two months after a damaging shareholder dispute. Alan Jope, responsible for the beauty activities of the Anglo-Dutch group, will succeed him in January. The departure of Mr Polman comes after the company was forced to abandon a project to transfer the headquarters of the group of consumer goods in the Netherlands in October, following an investor revolt.

About 170 police, prosecutors and tax inspectors searched six German Bank The press offices in Frankfurt and surrounding areas on Thursday on charges of money laundering, said the Frankfurt Public Prosecutor in a statement. Investigators are investigating the activities of two Deutsche Bank staff who allegedly helped clients set up offshore companies to launder money, the prosecutor's office said. Written and electronic commercial documents have been seized from Deutsche Bank and new investigations are under way, the prosecutor's office also said. Deutsche Bank confirmed the search of its offices and indicated that it was cooperating fully with the authorities. Deutsche Bank shares fell by around 3% in Europe.

According to Susan Krashinsky Robertson of the Globe, Tim Hortons is the largest investment in branding since the takeover by Brazilian private equity firm 3G Capital in 2014 as it attempted to one of the newspapers after conflicts with franchisees. The ad, which will be launched online Thursday and on television next week, will double the Toronto-based chain's spending on building the brand, with at least five announcements launched in the coming year. Tim Hortons belongs to Restaurant Brands International.

The German antitrust authority has opened an investigation to determine whether the US giant of electronic commerce Amazon exploits its market dominance in its relationships with third-party retailers who use its website as a marketplace. The Federal Cartels Office said Thursday in a statement that it had received numerous complaints from traders about Amazon's business practices. "Amazon acts as a sort of" caretaker "for customers, and the dual role of bigger trader and bigger market is hindering other traders on the platform," said cartel bureau chairman Andreas Mundt. .

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Small cap stocks to watch on Thursday

Economic News

According to Statistics Canada, the country's current account deficit decreased by $ 6.3 billion in the third quarter to $ 10.3 billion. This is the lowest level since late 2016, the agency said.

In the United States, the number of weekly unemployment claims stood at 234,000 last week, which is higher than the forecasts of 220,000 economists.

According to the US Department of Commerce, consumer spending rose 0.6% last month, as households spent more on prescription drugs and community services. September data was revised downward to show an increase in expenditures of 0.2% instead of the 0.4% increase previously noted.

(10 pm ET) US home sales on hold for October. The consensus is an increase of 0.9% over the previous month.

The minutes of the United States meeting of 7 and 8 November are published.

With Reuters and the Canadian press