Thursday , January 28 2021

Before Bell: What any Canadian investor needs to know today



Equities

US stock futures pushed higher early Tuesday with reports of continued talks between the US and China about their heavy trading conditions that help create a scary market. World stocks also tried a preliminary rebound against a decline in global growth fear and uncertainty about the UK exit from the EU. In this country, futures on Bay Street were higher, as raw prices recovered some of the losses of the previous session, which helped out of more stable stock markets and a supply outage in Libya.

After a wild session on Monday, Dow drop saw more than 500 points at a time before the end of the day, message Dow, major US market indicators were all positive, with Dow futures climbed with triple digits. Worldwide, MSCI countries' index rose by 0.1 percent, which threatens to end a five-day loss series. The markets in Europe were higher in morning trading. Asian markets were completed mixed that led their leadership from Wall Street's fleeting Monday meeting.

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"The slightest hint of bad news results in excessive sales," said Jasper Lawler, research director at London Capital Group, in a note. "The upward reversal, we saw [in U.S. stocks on Monday] is a bullish sign, even in the short term and increases European futures. However, it is unlikely that it is sufficient to break out of a long-term downward trend. "

Market voting continues to notice the impact of concerns over slower global economic growth and heavy trade relations between the United States and Canada. In recent developments, China's Vice-President Liu He spoke with US finance minister Steven Mnuchin and Trade Representative Robert Lighthizer, trade views in the next phase of the talks. The British Prime Minister Theresa May's decision on Monday to postpone an important parliamentary vote on her Brexit agreement has also increased market uncertainty and taken a toll on the British pound, which grew to US $ 1,2505 immediately after the announcement. Sterling fought around US $ 1,2571 early Tuesday.

In business news, Cenovus Energy published its investment plans for the coming year and said it expects to reduce spending by 4 per cent. In 2019. The company says it plans to spend between 1.2 billion. Dollars and 1.4 billion. Dollars next year with most of the money going to their Foster Creek and Christina Lake oil sands operations. "We are still focused on delivering on our obligations to shareholders," says Cenovus CEO Alex Pourbaix, Cenovus in a statement. "With our low cost base and strong operations, we already set the performance standard for the in situ oil sands industry."

Meanwhile, Enbridge Inc., which holds its investment day on Tuesday, confirmed its 10-percent annual growth guide through 2020. Enbridge also announced an increase of 10% in 2019.

On Wall Street, the shares were in Ford Motor Corp. and General Motors Co. both approx. 2 pct. Following a Bloomberg report, China is moving towards cutting tariffs on imported US plants. US President Donald Trump had said that China agreed in such a step during a recent G20 meeting in Argentina. Bloomberg reports that a proposal to lower tariffs on cars manufactured in the US to 15 percent from 40 percent has been sent to China's Cabinet. The Bloomberg report refers to sources that are familiar with the case.

Overseas markets in Europe – which sold heavily on Monday – were higher in the morning trade with the Pan-European STOXX 600 of 1.45 per cent. News that US and Chinese trade representatives were still in communication helped to increase the markets of resource shares – which are particularly sensitive to the development of trade with China – among the winners. Britain's FTSE 100 received 1.08 percent. Germany's DAX increased 1.46 percent, and France's CAC 40 gained 1.52 percent.

The markets in Asia became more mixed after the Wall Street volatile session. Shanghai Composite Index rose 0.37 percent. Hong Kong's Hang Seng rose 0.7 percent. Japan's Nikkei fell 0.34 percent. The wider Topix fell 0.91%.

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commodities

Raw prices were higher early, helped by unplanned supply cuts in the OPEC member Libya. Brent and West Texas Intermediate were both positive in front of North America open with Brent trading within a daily range of US $ 59.91 to US $ 60.54. WTI had a range of US $ 50.70 to US $ 51.48. One day earlier, commodity prices returned a lot in last week's post-OPEC winnings with Brent falling 3 per cent.

"Increase from OPEC + output cut [didn’t] lasting long after oil prices, where Brent and WTI both act back in the vicinity of their recession, "says OANDA analyst Craig Erlam." Whether this is the case with the agreement's subcontracting in relation to market expectations, doubts about its ability to lay a surge in the supply or the group's ability to deliver, prices again appear to be vulnerable and a break below US $ 58 in Brent and US $ 50 in WTI could be the catalyst for another wave of sales. "

Prices began Tuesday on a news from a cessation of production in Libya, where the National Oil Company announced Monday a force majeure on exports from the El Sharara oil field, the country's largest seized last weekend by a military group. However, the gains were covered by persistent volatile equity markets.

The gold prices meanwhile marked higher Tuesday Tuesday when the US dollar was softened ahead of next week's Federal Reserve decision on interest rates. Markets are looking for Fed to hint of a slower rate of price increases in the new year. Spot gold rose 0.2 per cent. At US $ 1,247.38 per ounce at midmorning in Europe. On Monday, gold hit its highest for almost five months at US $ 1,250.55 in the previous session. US gold futures were 0.3 percent higher at US $ 1,252.90 per ounce.

"I'll stay pretty bullish on Gold one week before a Fed meeting, where a rate hike is no longer the guarantee it saw a couple of weeks ago, and the central bank is expected to adopt a less hawkish tone than it has for some time." . Erlam said, "The only thing that stands out seems to be a collapse in the negotiations between the United States and China and / or the United States and Europe."

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Currency and bonds

The Canadian dollar was slightly changed as raw prices stabilized, and its US counterparty lost its height against a basket of world currencies. Today's reach on loonie up to now is 74.51 US cents to 74.68 cents. RBC Elsa Lignos said in an early remark that a shaky risk reduction and weaker oil prices held pressure on wage during Monday's session.

Loonie was weaker Monday after a sharp increase last week at better than expected oil prices with a negative spread on Canada's two and five year yields, which was negative for the first time since 2007. Five-year yields fell 0.6 basis points over two-year dividends. A negative rate curve is generally seen as an early warning of tougher economic progress.

In the world's currencies, the US dollar index fell by 0.3 percent to 96,952 after climbing 0.75 percent during the previous session. Reuters notes that the index at one point the night had fallen as low as 96,364, the lowest since 22 November. US dollars are under pressure ahead of next week's Fed meeting, where analysts expect the central bank to hit a more deaf tone of future interest rate hikes. Federal officials have already signaled a possible decline in increases in the coming year, indicating that rates approach neutral levels.

The British pound, which was hit Monday because of chaos about Prime Minister Theresa Mays Brexit Agreement, slipped 20-month decline after Mrs. May sought support from European leaders to change the deal. Ms. May met with Dutch Prime Minister Mark Rutte and will meet German Chancellor Angela Merkel in an attempt to rescue the agreement prior to an EU summit later this week. Sterling increased by 0.4 per cent. To USD 1.2615, after falling 1.6%. Towards US dollars on Monday to as low as US $ 1,2507.

In bonds, the yield on the US 10-year note was higher at 2,883 percent. The yield on the 30-year note was also higher at 3,143 percent.

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Shares set to see action

Athabasca Oil Corp. says it has hit a $ 265 million deal to sell its Leismer pipelines and Cheecham storage terminal to Enbridge Inc. Athabasca says that the proceeds will strengthen the company's liquidity, reduce debt and improve financial elasticity. At the release, Athabasca also said that it is cutting headline staff by 25 percent immediately and executives take a wage decline of 10 percent. The company also said it implemented a minimum program in 2019 focusing on maintaining core production until market funding improved.

Globens Tim Kiladze reports that a leading credit rating agency is reporting about management issues Hydro One Ltd. after the state of Washington cited political interference from the Ontario government in rejecting the first major acquisition of the use. Standard & Poor's, who have already lowered the company's credit rating once, said in a report that it could downgrade it again "if the Ontario government goes into further [Hydro One’s] business or operating decisions, which results in additional management difficulties that we consider to be serious. "S & P has an A-minus rating on debt after cutting it from an A rating in September. A lower rating usually means higher borrowing costs.

Managing Director of Alphabet Inc. Faced with a barbeque from American legislators about how web searchers struggled to handle an alarming data breach, and whether it could bend to the Chinese government's censorship requirements. CEO Sundar Pichai looks Tuesday before the House Judiciary Committee comes after he angered members of a senate panel in September by rejecting their invitation to witness foreign government's manipulation of online services to flood US elections. Pichai's no show at this hearing was marked by an empty chair for Google along with Facebook and Twitter executives. In a written testimony that the Judicial Committee announced Monday, CEO Sundar Pichai said he led the company "without political bias". "We are working hard to ensure the integrity of our products, and we have put a number of checks and balances in place to ensure they continue to meet our standards," said Pichai's testimony. "I lead this company without political bias and work to ensure that our products continue to function in that way. To do otherwise would violate our fundamental principles and our business interests."

A Tokyo court on Tuesday rejected Nissan Motor President Carlos Ghosn's appeal to end his detention after his arrest last month for a claim of financial error. Ghosn has been held in a jail in Tokyo when he was arrested on November 19 after the suspicion of conspiring to underestimate his salary by about half of the actual 10 billion. Yen (USD 88 million), was awarded over five years from 2010. He became official on Monday.

WPP plans to spend 300 million pounds over the next three years to turn the world's largest advertising group into growth by reducing the number of agencies that run and employ more talent in New York. The British owner of the JWT and Ogilvy agencies have lost 40 percent of the value in the last year and have been forced to reduce their sales and profit forecasts after losing some major customers and others reducing their expenses. On Tuesday it said that it would maintain and prioritize its return on repurchases and offers.

Verizon Communications Inc. Expect to charge taxes of 1.8 billion. USD to 2.1 billion. USD in this quarter for job cuts announced on Monday, said the US wireless operator. The company had said that about 10,400 employees will leave in the middle of next year as part of their voluntary separation program.

MTY Food Group Inc. has signed an agreement to acquire South St. Burger, a chain of gourmet burger restaurants. Financial terms of the agreement were not immediately available. The Burger chain will participate in MTY's other banners, including Thai Express, Vanellis, Manchu Wok, Baton Rouge, Pizza Delight and Scores. South st. has 26 franchises and 14 corporate restaurants.

More reading:

Tuesday's small stockholdings to see

Tuesday analysts upgrades and downgrades

Economic news

The US Labor Department says the producer price index rose by 0.1 per cent in November. From the previous month. It is down from 0.6%. Gain in October. Producer prices track price changes in factory exports. Wholesale prices rose 2.5%. From the previous year, the smallest annual increase in 2018. Without the volatile food and energy categories, US wholesale prices rose by 0.3%. In October and 2.7 per cent. Last year.

With Reuters, The Canadian Press and The Associated Press


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