| Stocks Seeing Modest Weakness In Early Trading
Stocks have moved modestly lower in early trading on Wednesday, adding to the steep losses posted in the previous session. The major averages have slipped into negative territory, although selling pressure remains relatively subdued.
The major averages have recently edged up off their lows for the young session but remain in the red. The Dow is down 42.16 points or 0.3 percent at 13,431.37, the Nasdaq is down 4.08 points or 0.1 percent at 3,060.94 and the S&P 500 is down 2.64 points or 0.2 percent at 1,438.84.
The early weakness on Wall Street reflects lingering concerns about the outlook for the global economy following disappointing guidance from aluminum giant Alcoa (AA).
While Alcoa reported third quarter results that exceeded analyst estimates, the company also lowered its forecast for global aluminum demand growth in 2012 to 6 percent from 7 percent.
The release of results from Alcoa is seen as the start of earnings season, and the lower guidance may lead to worries about the possibility of disappointing forecasts from other companies.
Shares of Chevron (CVX) are moving to the downside after the oil giant said it expects its third quarter earnings to be substantially lower than in the second quarter.
The company said it expects upstream earnings to be hurt by foreign exchange losses and lower liftings and realizations, while timing effects, lower realized margin and the negative effects of several smaller unrelated items are expected to drag downstream earnings lower.
Many of the major sectors are showing only modest moves in early trading, although considerable weakness has emerged among electronic storage stocks. The NYSE Arca Disk Drive Index has tumbled by 3.1 percent to its lowest intraday level in well over two months.
Airline, computer hardware, and oil stocks have also come under pressure, while housing stocks are regaining some ground following recent weakness.
In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Wednesday. Japan's Nikkei 225 Index tumbled by 2 percent, while Hong Kong's Hang Seng Index edged down by 0.2 percent.
The major European markets have also moved to the downside on the day. While the U.K.'s FTSE 100 Index has dipped by 0.3 percent, the French CAC 40 Index and the German DAX Index have both edged down by 0.1 percent.
In the bond market, treasuries have moved modestly lower after ending the previous session moderately higher. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 1.9 basis points at 1.739 percent.
| Canadian Market |  | | CADUSD | Oil | Gold | Allbanc |  |  |  |  | | Please click on the images to view our interactive charts | | | TSX Poised To Extend Losses At Open
Canadian stocks may extend losses at open Wednesday as commodities were struggling to move higher amid gloomy forecasts for world economic growth, with the IMF trimming its estimates for global economic growth and warning that mature economies are at risk of recession.
The IMF, in its recent report, predicted that the world economy will grow 3.3 percent this year, the slowest since the 2009 recession, and 3.6 percent next year, compared with July predictions of 3.5 percent in 2012 and 3.9 percent in 2013.
In the commodities market, the price of crude oil was ticking lower Wednesday morning after witnessing smart gains in the previous session on supply concerns. Meanwhile, the Organization of the Petroleum Exporting Countries maintained its 2013 world oil demand growth forecast at 0.80 mbd and that of its world economic growth projection at 3.2 percent for 2013. Crude for November shed $0.35 to $92.04 a barrel.
The price of gold little changed Wednesday morning amid global growth concerns after the recent warning from the IMF on world economic growth. Gold for December edged up $1.10 to $1,766.10 an ounce.
In corporate news from Canada, Kinross Gold Corp. said that Executive Vice-President and Chief Financial Officer, Paul Barry, would depart in order to pursue other interests.
Energy services company Hyduke Energy Services said its has recommended its shareholders not to deposit any shares in response to the unsolicited offer from Do All Industries Ltd for cash consideration of $0.83 per common share. Yesterday the stock soared 9 percent to C$0.83, matching the offer price.
Sport equipments maker Bauer Performance Sports posted lower first-quarter net income of C$16.0 million or C$0.45 per share compared to C$22.6 million or C$0.72 per share in the prior year quarter.
Computer maker Smart Technologies Inc. announces the appointment of Neil Gaydon as its President and Chief Executive Officer, effective October 24, 2012. Gaydon brings over 28 years of technology experience and leadership, most recently serving as CEO of Pace plc.
In economic news from the euro zone, Germany's wholesale price inflation increased in September at the fastest pace since November 2011, data from Destatis revealed. Wholesale prices rose at a more than expected pace of 4.2 percent year-on-year in September after climbing 3.1 percent in August. The annual rate was forecast to reach 3.3 percent.
Meanwhile, France's industrial production growth accelerated in August, increasing hopes that the second largest euro zone economy could escape a recession in the third quarter. Data released by statistical office Insee showed that industrial production rose by 1.5 percent month-over-month in August, faster than the 0.6 percent gain seen in July. Economists were looking for a 0.3 percent decline.
| European Market | | | | FTSE 100 | Euronext | Dax perf | CAC 40 |  |  |  |  | | Please click on the images to view our interactive charts | | | European Stocks Decline As Growth Worries Persist
The European markets are in negative territory in afternoon trading Wednesday, as global growth worries continued to impact investor sentiment. The Asian markets broadly fell, led by Japan, and the U.S. index futures point to a lower open.
The International Monetary Fund warned that in the absence of decisive and urgent policy measures, banks in Europe may need to sell as much as $2.8 trillion to $4.5 trillion worth of assets through the end of 2013.
In its latest Global Financial Stability Report, the IMF said the largest burden of credit supply contraction will fall on the euro area periphery. Faltering market confidence has led to capital flight from countries on the 'periphery' to the core of the euro area.
Spanish Prime Minister Mariano Rajoy is due to meet French President Francois Hollande today, a week after he played down reports of a potential Spanish bailout.
Chancellor Angela Merkel has pledged her country's continuing support to Greece amid lingering concerns about Europe's debt crisis. The German leader, who arrived in Athens on Tuesday to meet with Greek leaders regarding the ongoing debt crisis, said Greece had made significant progress in dealing with its huge debt but that it was a "difficult path."
Meanwhile, the European Union's proposal of imposing a tax on financial transactions found more supporters at Tuesday's Ecofin meeting in Luxembourg, signaling that a decision on the project may come after the EU finance ministers' November meeting.
In France, industrial production growth accelerated in August, increasing hopes that the second largest Eurozone economy could escape a recession in the third quarter. Data from Insee showed industrial production rose 1.5 percent month-over-month, faster than the 0.6 percent gain seen in July. Economists expected a 0.3 percent decline.
The Euro Stoxx 50 index of eurozone bluechip stocks is falling 0.51 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, is losing 0.33 percent.
The German DAX is falling 0.28 percent and the French CAC 40 is dropping 0.26 percent. The UK's FTSE 100 is losing 0.39 percent and Switzerland's SMI is sliding 0.30 percent.
In Frankfurt, SAP is declining 2.2 percent after Barclays cut the stock to ''Equalweight'' from ''Overweight.'' Linde is losing 1.2 percent. Berenberg initiated the stock with a ''Buy'' rating.
Citigroup raised Volkswagen to "Buy" from "Neutral." The stock is flat. Daimler and BMW are moderately lower. Commerzbank is losing 0.1 percent while Deutsche Bank is rising 0.3 percent.
Deutsche Bank raised Man to "Buy" from "Hold." The shares are adding 2 percent.
In Paris, Publicis Groupe is losing 2.6 percent, followed by Cap Gemini, which is down 2.3 percent. Saint-Gobain is falling 1.9 percent. UBS cut the stock to "Neutral" from "Buy." Berenberg initiated Air Liquide with a "Hold'' rating. The stock is down 0.5 percent.
Peugeot is losing 1.5 percent. Moody's Investors Service downgraded the carmaker to Ba3 from Ba2, and the outlook is negative. The ratings agency attributed the action to the challenges facing Peugeot in restructuring its automotive business and reducing the cash burn.
EADS is up 0.4 percent as deadline approaches for the deal with BAE Systems. BAE is falling around 1 percent in London.
In London, Fresnillo is losing 2.7 percent. Antofagasta is falling 1.6 percent while Anglo American is gaining 1.3 percent.
Avanti Communications is plunging over 15 percent. The satellite operator reported a wider loss for fiscal 2012, despite significant growth in revenues.
Lenders are seeing gains. Barclays, Royal Bank of Scotland and Lloyds Banking are advancing between 1 percent and 3.6 percent.
Fiat is falling 0.3 percent in Milan. Moody's Investors Service downgraded the corporate family rating and probability of default rating of Fiat to Ba3 from Ba2, reflecting the decline in demand for Italian cars this year. |
| Asia Market | | Asian Stocks Fall On Economic Concerns
Asian stocks fell broadly on Wednesday, weighed down by earnings concerns and global growth worries after brokerages cut their ratings on Intel shares and the International Monetary Fund warned of a credit crunch and a recession, if European policymakers do not fulfill promises to establish a common bank supervisor and Washington fails to reverse the looming "fiscal cliff" austerity plan.
Earnings season kicked off in the U.S., with Alcoa reporting a $143 million third quarter loss on $5.54 billion in sales that exceeded analysts' estimates. However, the company cut its full year aluminum demand forecast, reflecting slowing Chinese demand and continued uncertainty over Europe's debt problems.
German chancellor Angela Merkel's visit to Greece provoked clashes in Athens yesterday as she made her first visit to the nation since the Eurozone crisis erupted three years ago. Merkel praised the course of Greek reforms required for recovery, but said the coalition government led by prime minister Antonis Samaras still had to push through more key cost-cutting reforms.
Commodities were narrowly mixed and the euro fell for a third day on concerns over Greece and Spain. The IMF increased the pressure on European policymakers to restore sagging confidence in the global financial system, saying the region's banks may need to shrink assets worth about $2.8 trillion over two years if pressures were allowed to continue.
Spanish Prime Minister Mariano Rajoy is due to meet French President Francois Hollande today, a week after he played down reports of a potential Spanish bailout.
Japanese shares fell to a two-month low on growing concerns over the global economic outlook. The Nikkei average tumbled almost 2 percent to its lowest closing level since August 3, while the broader Topix index shed 1.5 percent. Heavyweights such as Fast Retailing and Softbank lost 2-3 percent, Toyota Motors fell 1.9 percent, extending declines for the second consecutive session on worries over declining sales in China, Honda Motor dropped 1.1 percent and auto parts maker Denso retreated nearly 3 percent, while Nissan added 1.2 percent.
Steel makers Nippon Steel, JFE Holdings and Kobe Steel fell 2-5 percent after Nomura Securities cut its ratings on the stocks, citing a decline in steel consumption by Japan's manufacturing sector. Dainippon Screen Manufacturing rose 1.6 percent on bargain hunting following the previous session's sell-off, Komatsu added a percent and Tokyo Electron gained half a percent.
Chinese shares bucked the regional downward trend to end modestly higher, with sentiment underpinned by continued hopes for further market-boosting measures from Beijing. The benchmark Shanghai Composite rose 0.2 percent, while Hong Kong's Hang Seng index edged down 0.1 percent.
Australian shares retreated from 13-month highs, mirroring losses in U.S. and European stocks overnight on earnings concerns ahead of the start of the third-quarter reporting season. Both the benchmark S&P/ASX 200 and the broader All Ordinaries index fell about 0.3 percent each.
Retailers and media stocks bore the brunt of the selling, while BHP Billiton edged up marginally after unveiling plans to cut jobs and rein in costs in its iron ore division. Rio Tinto edged up 0.2 percent after the company said it would step up cost-cutting measures to cope with the uncertain near-term outlook. Smaller rival Fortescue Metals Group fell 2.8 percent and gold miner Newcrest lost 1.3 percent.
Among the major banks, Westpac slid 0.7 percent on a brokerage downgrade, NAB lost 0.4 percent, ANZ slipped 0.2 percent and Commonwealth declined 0.1 percent. Qantas Airways soared 3.5 percent on speculation that the company might demerge its frequent flyer business. Oil & gas firm Woodside Petroleum rose 1.6 percent after crude prices soared on Tuesday on renewed concerns about Middle East tensions.
Seoul stocks tumbled on foreign fund selling amid nagging concerns about the global economy. The benchmark Kospi average fell 1.6 percent, with tech shares coming under significant selling pressure after technology stocks led the declines in the U.S. overnight following brokerage downgrades of Intel and other major companies. Samsung Electronics, the world's biggest memory-chip maker, tumbled 3.4 percent, its biggest single-day loss since August.
NEW Zealand shares fell for a second consecutive session, mirroring losses in regional stocks on continued worries about the strength of China's economy. The benchmark NZX-50 index slid half a percent, with steel products manufacturer Steel & Tube falling 8.3 percent after Australian company Arrium sold its 50.3 percent shareholding in the company at a 15 percent discount to Tuesday's closing price.
Industrial rubber products supplier Skellerup Holdings tumbled 3.4 percent on going ex-dividend, fast food operator Restaurant Brands lost 2.1 percent, carpet maker Cavalier shed 2.1 percent and clothing retailer Hallenstein Glassons declined 1.8 percent. Utility Contact Energy led the gainers, rising 1.7 percent after The Electricity Authority set out a new pricing regime for the national grid reflecting its benefit to generators and consumers. Australian food ingredient maker Goodman Fielder rose 1.5 percent and children's clothing chain Pumpkin Patch added 0.8 percent.
Elsewhere, India's benchmark Sensex was down 0.9 percent, Indonesia's Jakarta Composite index was little changed, Malaysia's KLSE Composite slipped 0.2 percent, Singapore's Straits Times index lost a little over a percent and the Taiwan Weighted average eased 0.3 percent. |
| Commodities | | | | USDCAD | USDEUR | USDGBP | USDJPY |  |  |  |  | | Please click on the images to view our interactive charts | | | Crude Steady Above $92
The price of crude oil was ticking lower Wednesday morning after witnessing smart gains in the previous session on supply concerns.
Light Sweet Crude Oil (WTI) futures for November delivery, slipped $0.26 to $92.10 a barrel. Yesterday, oil rebounded from a 2-month low mostly on bargain hunting and renewed supply concerns after news that the ongoing unrest in Syria could spread to adjoining areas, with Turkey keyed up after mortar strikes on its territory. There were also news reports of Nato plans to protect Turkey's border with Syria following increased tensions between the two countries.
The Organization of the Petroleum Exporting Countries (OPEC) maintained its world oil demand growth projections at 0.8 mbd for 2013, in line with the growth for the current year.
The price of gold was little changed Wednesday morning amid global growth concerns after the recent warning from the IMF on world economic growth.
Gold for December delivery, the most actively traded contract, eased $0.40 to $1,764.60 an ounce. Yesterday, gold extended losses for a third session amid global growth concerns and an uncertain outcome of the euro zone finance ministers meeting over Greece and Spain. Prices were under pressure after the International Monetary Fund cut its projection of world economic growth and Greece was granted just 10 days to fulfill all bailout funding conditions for the next tranche of aid. The dollar continued to strengthen impressively against some major currencies, while the euro continued to slide.
Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, were unchanged at a record high of 1,340.52 tons.
This morning, the U.S. dollar continued to recover from a two-week low versus the euro and advancing to a monthly high against sterling. The buck was trading flat versus the Swiss franc and the yen.
In economic news from the euro zone, Germany's wholesale price inflation increased in September at the fastest pace since November 2011, data from Destatis revealed. Wholesale prices rose at a more than expected pace of 4.2 percent year-on-year in September after climbing 3.1 percent in August. The annual rate was forecast to reach 3.3 percent.
Meanwhile, France's industrial production growth accelerated in August, increasing hopes that the second largest euro zone economy could escape a recession in the third quarter. Data released by statistical office Insee showed that industrial production rose by 1.5 percent month-over-month in August, faster than the 0.6 percent gain seen in July. Economists were looking for a 0.3 percent decline.
Traders will look to the the wholesale inventories report from the Commerce Department, due out at 10 a.m. ET. Economists expect wholesale inventories at the end of August to show a 0.4 percent increase compared to a 0.7 percent increase in July
Today after the market hours, the API will release its crude oil inventories report from the weekended October 05. |
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