| Bargain Hunting Leads To Early Strength On Wall Street
Stocks have moved moderately higher in early trading on Thursday, partly offsetting the steep losses posted in the previous session. The major averages have moved back to the upside, rebounding off yesterday's three-month closing lows.
The major averages have recently pulled back off their highs for the young session but remain in positive territory. The Dow is up 27.43 points or 0.2 percent at 12,960.16, the Nasdaq is up 11.14 points or 0.4 percent at 12,960.16 and the S&P 500 is up 4.65 points or 0.3 percent at 1,399.18.
The early strength on Wall Street is partly due to bargain hunting, with traders picking up stocks at reduced levels following Wednesday's sell-off.
Buying interest was also generated by some relatively upbeat U.S. economic data, including a report from the Labor Department showing an unexpected drop by initial jobless claims.
The report said jobless claims fell to 355,000 in the week ended November 3rd, a decrease of 8,000 from the previous week's unrevised figure of 363,000. The drop surprised economists, who had expected jobless claims to climb to 370,000.
However, the data was likely skewed as a result of Hurricane Sandy, which wreaked havoc along the East Coast and likely prevented some people from filing claims.
A separate report from the Commerce Department showed that the U.S. trade deficit unexpectedly narrowed in the month of September, as the value of exports rose at a faster rate than the value of imports.
Paul Dales, Senior U.S. Economist at Capital Economics, said the unexpected narrowing by the trade deficit "opens the door to an upward revision to third-quarter GDP growth, but probably not a significant one."
Telecom stocks have shown a strong move to the upside in early trading, with Qualcomm (QCOM) helping to lead the sector higher. Shares of Qualcomm have jumped by 6.7 percent after the wireless giant reported better than expected quarterly results and provided upbeat guidance.
Networking, banking, and airline stocks are also seeing early strength, regaining some ground after ending the previous session sharply lower. Most of the other major sectors are showing more modest moves.
In overseas trading, stock markets across the Asia-Pacific region saw considerable weakness following the overnight sell-off on Wall Street. Japan's Nikkei 225 Index fell by 1.5 percent, while Hong Kong's Hang Seng Index tumbled by 2.4 percent.
Meanwhile, the major European markets are regaining some ground after falling sharply on Wednesday. While the French CAC 40 Index has risen by 0.5 percent, the U.K.'s FTSE 100 Index and the German DAX Index are both up by 0.4 percent.
In the bond market, treasuries are giving back some ground after ending the previous session sharply higher. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 6.3 basis points at 1.695 percent | Canadian Market |  | | CADUSD | Oil | Gold | Allbanc |  |  |  |  | | Please click on the images to view our interactive charts | | | TSX Edges Up At Open Thursday
Bay Street stocks edged up at open Thursday amid marginal buying in commodities, with the S&P/TSX Composite Index adding 15.29 point or 0.12 percent to 12,245.87.
In the oil patch, Crescent Point Energy Corp. edged up 1 percent even after announcing that its quarterly net income decreased sharply. International gold miner Kinross Gold rose nearly 6 percent after reporting improved third-quarter net earnings.
Automotive supplier Magna International Inc. reported a much improved third quarter net income. The stock jumped nearly 5 percent.
Chile focused base-metals miner Andina Minerals Inc. soared 95 percent after it said it would be acquired by Hochschild Mining plc in exchange of C$0.80 per share
Meanwhile, quick service restaurant chain Tim Hortons Inc. slipped 1 percent even after reporting a higher third-quarter net income. Energy company Canadian Natural Resources lost about 4 percent after recording a plunge in third-quarter net earnings.
The price of crude oil was recovering from its yesterday's steep fall Thursday morning even as worries continued that US may not be able to avoid the deep spending cuts and tax hikes set to automatically take place in January. Crude for December added $0.94 to $85.38 a barrel.
The price of gold little changed Thursday morning as the US dollar was steady versus a basket of currencies amid today's macroeconomic data. Gold for December edged up $1.30 to $1,715.30 an oucne.
In corporate news from Canada, energy company Canadian Natural Resources reported a plunge in third-quarter net earnings to C$360 million or C$0.33 per share from C$836 million or C$0.76 per share last year. Adjusted net earnings from operations totaled C$353 million or C$0.32 per share, significantly lower than C$719 million or C$0.65 per share a year ago.
Crescent Point Energy Corp. announced that its quarterly net income decreased sharply to C$2.35 million or C$0.01 per share from C$204.62 million or C$0.74 last year.
Automotive supplier Magna International Inc. reported a much improved third quarter net income of $390 million or $1.66 per share compared to $102 million or $0.42 per share reported for the corresponding quarter last year.
Insurance services provider Manulife Financial Corp. reported a narrower third-quarter net loss at C$258 million or C$0.14 per share compared to a net loss of C$1.299 billion or C$ 0.73 in the year ago quarter.
Financial services company Home Capital Group reported higher third-quarter net income of C$57 million or C$1.65 per share, compared with C$48 million or C$1.39 per share last year. Analysts expected the company to report earnings of C$1.61 per share for the quarter.
Packaging and tissue products company Cascades Inc. swung to profit in third quarter reporting net earnings of C$5 million or C$0.05 per share compared with a net loss of C$20 million or C$0.19 per share reported for the corresponding quarter last year. Excluding specific items, earnings per share were C$0.07 compared to loss per share of C$0.02 in the corresponding period last year. Analysts expected the company to report earnings of C$0.15 per share.
Quick service restaurant chain Tim Hortons Inc. reported a higher third-quarter net income at C$105.7 million or C$0.68 per share compared to C$103.6 million or C$0.65 per share in the comparable period. Analysts expected earnings per share of C$0.72 for the quarter.
Food and beverages company Premium Brands Holdings Corp. posted lower third-quarter earnings of C$4.60 million or C$0.22 per share versus C$6.10 million or C$0.32 per share last year.
International gold miner Kinross Gold reported improved third-quarter net earnings of $224.9 million or $0.20 per share compared to $212.6 million or $0.19 per share in the year ago quarter. Adjusted net earnings from continuing operations were $250.4 million or $0.22 per share, compared with $269.4 million or $0.24 per share. Analysts expected the company to report earnings of $0.19 per share for the quarter.
Chile focused base-metals miner Andina Minerals Inc. said it would be acquired by Hochschild Mining plc in exchange of C$0.80 per share, valuing it approximately C$103 million. The offer price represents a premium of about 100 percent to its latest closing price.
In economic news, Statistics Canada said trade deficit with the world narrowed to $826 million in September from $1.5 billion in August as merchandise exports rose 1.9 percent and imports were unchanged in September.
Separately, the agency said the New Housing Price Index (NHPI) rose 0.2 percent in September, following a similar increase in August. |
| European Market | | | | FTSE 100 | Euronext | Dax perf | CAC 40 |  |  |  |  | | Please click on the images to view our interactive charts | | | European Markets Rise Ahead Of Policy Decisions
The European markets are in in positive territory on Thursday, ahead of the key interest rate decisions from the European Central Bank and the Bank of England. Markets fell across Asia/Pacific amid worries about the U.S. fiscal cliff.
At 7.00 am ET, the Bank of England is set to announce the results of the monetary policy meeting. The bank is expected to maintain its quantitative easing at GBP 375 billion and the interest rate at 0.50 percent.
At 7.45 am ET, the European Central Bank will announce its interest rate decision. The central bank is seen holding its interest rate at 0.75 percent. ECB President Mario Draghi is unlikely to announce any new liquidity programme today.
Germany's exports declined in September at the fastest pace since December 2011, reflecting subdued demand from Europe and underpinned the assessment that the growth-engine of the single currency bloc will remain weak at the end of 2012.
Greece's parliament on Wednesday narrowly approved a law on austerity measures. The approval, amid protests by people, clears the way for the country to secure the next bailout tranche worth 31.5 billion euros.
The Euro Stoxx 50 index of eurozone bluechip stocks is advancing 0.55 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, is rising 0.42 percent.
The German DAX is gaining 0.5 percent and the French CAC 40 is rising 0.3 percent. The UK's FTSE 100 is adding 0.3 percent and Switzerland's SMI is advancing 0.4 percent.
In Frankfurt, Siemens said it is targeting total sectors profit margin of at least 12 percent by 2014 and aims productivity gains of 6 billion euros over the coming two years. The industrial conglomerate posted an increase in profit for the fourth quarter, amid a modest growth in revenues. The stock is up 4 percent.
HeidelbergCement is gaining 2.6 percent. The firm announced quarterly results today. Deutsche Telekom is flat. The firm slipped to a third-quarter loss. Commerzbank, which reported third-quarter results, is falling 3.2 percent.
Adidas is declining 3.8 percent. The sports goods giant reported a rise in third-quarter profit and adjusted its sales guidance. Dialog Semiconductor is falling 2.2 percent, following a broker downgrade.
In Paris, Vallourec is leading the gainers by adding 5.4 percent. Alcatel Lucent and Alstom are gaining 2.9 percent and 2.4 percent, respectively.
Societe Generale is up 0.5 percent. The lender recorded about 130 million euros loss in the third quarter after it agreed last month to sell its Greek unit Geniki Bank to Greek lender Piraeus Bank.
STMicroelectronics is gaining around 1 percent after UBS removed the stock from "Least Preferred" tech shares. Michelin is losing 0.5 percent. UBS added the stock to "Most Preferred List'' in European automobiles.
EADS is dropping 0.9 percent. The company reported marginally lower profit in the third quarter. Cap Gemini is dropping 3.2 percent and EDF is losing 1.5 percent.
Renault is falling 1.4 percent. UBS removed the stock from "Most Preferred List'' in European automobiles.
In London, Burberry is gaining 2.9 percent. Randgold Resources and Johnson Matthey are up around 1.8 percent each.
Eurasian Natural Resources, which issued an Interim Management Statement, is dropping 3.3 percent.
Tate & Lyle is falling 1.4 percent and Land Securities is sliding 1.3 percent. Dexia is climbing 5.6 percent in Brussels. Belgian and French states, which control Dexia, have agreed to pump in 5.5 billion euros of fresh capital to the stricken lender, after the bank reported hefty losses and write-downs.
KBC is climbing 3.8 percent in Brussels. Repsol is up 1.7 percent in Madrid. The company reported third-quarter results. Swiss Re is gaining 2.2 percent in Zurich on higher quarterly profit. |
| Asia Market | | Asian Stocks Retreat On Risk Aversion
Asian stocks fell sharply on Thursday, as the initial cheer over Barack Obama's victory in the U.S. presidential election faded and investors looked ahead to the looming "fiscal cliff" crisis which if left unattended may pose a real threat to the global economy. Fitch Ratings warned that the U.S. may be downgraded next year unless lawmakers act quickly on the so-called fiscal cliff and raise the debt ceiling in a timely manner.
With worries about Europe's deteriorating growth and a stronger U.S. dollar denting sentiment, investors awaited the upcoming ECB and BOE rate decisions and the impending leadership transition in China for further direction.
Japanese shares fell almost across the board, weighed down by a range of issues including festering U.S. fiscal problems, flagging growth prospects for the euro zone's biggest economies, the yen's newfound strength against the U.S. dollar and euro as well as weak core machinery data. The Nikkei average fell 1.5 percent to 8,837.15, its lowest close since Oct. 17, while the broader Topix index lost 1.4 percent.
Among the prominent decliners, Advantest, Fast Retailing, Hitachi, Komatsu, Canon, Fanuc and Sony fell 1-3 percent. Isuzu Motors rallied 4.7 percent, a day after the company lifted its earnings guidance for the full-year to March. Shares of Softbank rose 0.3 percent, extending gains for a third consecutive session.
In economic news, data released by the Cabinet Office showed that Japan's core machinery orders fell a seasonally adjusted 4.3 percent in September from the previous month, falling for the second straight month and missing forecasts for a decline of 2.1 percent. On a yearly basis, core machine orders declined 7.8 percent - also missing expectations for a 4.9 percent decline.
China's Shanghai Composite index fell 1.6 percent, with resource stocks leading the declines on worries about the fiscal crisis in the United States and Europe's growth prospects. The Communist Party started its 18th Congress in Beijing today that will usher in a once-in-a decade leadership change against a backdrop of a slowing economy and bitter territorial disputes with Japan. Hong Kong's Hang Seng index lost 2.4 percent, dragged down by resource firms.
Australian shares lost ground following losses in offshore markets as investors fretted over the looming fiscal cliff. Both the benchmark S&P/ASX 200 and the broader All Ordinaries index fell about 0.7 percent each, with positive employment figures helping limit the downside to some extent. The Australian Bureau of Statistics reported today that the economy added 10,700 jobs in October, surpassing economists' estimates that only 1.000 jobs would be added. Full-time employment increased by 18,700 jobs, while part-time employment decreased by 8,000. The nation's unemployment rate stood unchanged at 5.4 percent.
Among the major banks, ANZ fell 4.5 percent on going ex-dividend and NAB slid half a percent, while Westpac edged up 0.3 percent and Commonwealth gained 0.7 percent. In the resource sector, BHP Billiton, Rio Tinto, Newcrest Mining and Fortescue Metals Group lost 1-3 percent. Maintenance service group Transfield Services rose 1.3 percent after it won a $200 million contract to provide maintenance and operations services to QGC's coal seam gas assets in Queensland.
Shares of Lynas Corporation soared 11.8 percent after the company won a legal battle on operating a controversial rare earth plant in Malaysia. Qantas Airways declined 1.5 percent on reports it will cut a further 400 jobs in its engineering unit.
Seoul stocks snapped a two-day winning streak as investors locked in some recent gains following the conclusion of the U.S. presidential election. The benchmark Kospi average fell 1.2 percent, with builders taking a beating on sluggish third-quarter earnings. Shares of GS Engineering & Construction plummeted 11.2 percent after the company reported a 74 percent drop in its third-quarter operating profit. Online game developer NCSoft slumped 12.9 percent on brokerage downgrades.
New Zealand shares rose modestly in contrast to weak regional markets. The benchmark NZX-50 index rose 0.3 percent. Exporters Xero and Fisher & Paykel Healthcare rose 6.4 percent and 0.8 percent, respectively, as the kiwi dollar dropped to a two-month low versus its Australian counterpart after official figures showed the Australian economy added 10,700 jobs last month, beating expectations.
Meanwhile, New Zealand's labor market report suggested that the nation's unemployment rate unexpectedly jumped half a percentage point to a 13-year high of 7.3 percent. Fletcher Building, the nation's largest construction company, gained 1.2 percent as a weak labor market stoked expectations of further interest-rate cuts. Retailer Kathmandu Holdings led the declines on the exchange, falling 4.5 percent on going ex-dividend.
Elsewhere, India's benchmark Sensex was down 0.3 percent, Indonesia's Jakarta Composite index slid half a percent, Malaysia's KLSE Composite edged down 0.3 percent, Singapore's Straits Times index fell 1.2 percent and the Taiwan Weighted average shed 0.6 percent. |
| Commodities | | | | USDCAD | USDEUR | USDGBP | USDJPY |  |  |  |  | | Please click on the images to view our interactive charts | | | Crude Rebounds After Sharp Fall
The price of crude oil was recovering from its yesterday's steep fall Thursday morning even as worries continued that US may not be able to avoid the deep spending cuts and tax hikes set to automatically take place in January.
Light Sweet Crude Oil (WTI) futures for December delivery, added $0.88 to $85.32 a barrel. Yesterday, oil shed nearly 5 percent after the Energy Information Administration's weekly oil report showed an increase in U.S. crude stockpiles with the dollar trading higher even as the euro slipped on euro zone worries. Oil prices also were impacted by demand growth concerns over the ongoing euro zone financial crisis.
Wednesday during trading hours, the EIA revealed that US crude oil inventories moved up by 1.80 million barrels and gasoline stocks added 2.90 million barrels in the weekended November 02. Analysts expected crude oil inventories to gain 1.8 million barrels last week.
The price of gold was little changed Thursday morning as the US dollar was steady versus a basket of currencies ahead today's macroeconomic data.
Gold for December delivery, the most actively traded contract, edged up $0.70 to $1,714.70 an ounce. Yesterday, gold ended flat after the dollar strengthened against some of the major currencies, even as the euro declined on concerns over the euro zone financial crisis. Nonetheless, President Barack Obama's reelection for a second term somewhat limited the precious metal's slide, reigniting hopes of continued monetary stimulus support in the world's largest economy.
Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, moved up to 1,337.21 tons from 1,334.49 tons.
This morning, the U.S. dollar was extending its 2-month high versus the euro and the Swiss franc, while advancing towards a three-week high against sterling. The buck was leveling off from its 4-month high versus the yen.
In economic news, Germany's exports declined in September at the fastest pace since December 2011, reflecting subdued demand from Europe. Exports declined 2.5 percent in September from a month ago, offsetting a 2.3 percent rise in August, Destatis said. Economists had forecast a 1.5 percent monthly fall for September.
The Bank of England today maintained its quantitative easing at GBP 375 billion and the interest rate at 0.50 percent, as widely expected.
The European Central Bank will announce its interest rate decision at 7.45 a.m. ET. The central bank is seen holding its interest rate at 0.75 percent.
Traders will look to the weekly jobless claims report from the U.S. Labor Department due out at 8.30 a.m.ET. Economists expect claims to increase to 370,000 from 363,000 in the previous week.
Separately, the Commerce Department will release the trade gap data for September. Economists estimate that the trade gap widened to $45.4 billion from a deficit of $44.2 billion in August. |
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