Luke KawaThe Globe and Mail
The Before the Bell report is updated throughout the premarket to reflect the latest news developments and market moves. Check back later for updates.
U.S. and Canadian stock futures are losing ground after the release of the non-farm payrolls report for February, the most closely watched piece of economic data in the world.
Nonfarm payrolls saw net gains of 295,000, beating the Street consensus of 235,000. Average hourly earnings in February rose 0.1 per cent from January, less than the 0.2 per cent expected by the Street.
Average hourly earnings have become the most important aspect to watch in the jobs report. The Federal Reserve, satisfied with the level of employment growth, has now turned its attention to wage growth, a harbinger that inflationary pressures are on the horizon. In January, average hourly earnings rose 0.5 per cent month-over-month.
In Europe, there were no revisions to euro zone GDP growth for the fourth quarter, confirmation that the region expanded by 0.3 per cent quarter-over-quarter in the final three months of 2014. This news comes a day after the European Central Bank announced its €60-billion per month quantitative easing program would commence on Monday, and hiked its growth projections for the next two years.
Meanwhile, a largely positive stream out European data continues to trickle out.
Spanish industrial production was up 0.4 per cent year-over-year in January; economists had anticipated a decline of 0.3 per cent. German industrial production increased by 0.6 per cent, its fifth consecutive monthly gain.
Imminent central bank purchases are putting downward pressure on sovereign bond yields, and European stocks are moving higher.
In Asia, Japan's Nikkei rose to a 15-year high while Chinese equities gave back ground.
West Texas Intermediate crude futures are trading near $51 per barrel (U.S.) ahead of the Baker Hughes rig count this afternoon.
Here's a look at the latest market numbers and other highlights ahead of the trading day.
Futures:
S&P 500 -0.4 per cent; Dow -0.4 per cent; Nasdaq -0.1 per cent
Equities:
Hong Kong's Hang Seng -0.16 per cent
Shanghai composite index -0.22 per cent
Japan's Nikkei +1.17 per cent
London's FTSE 100 -0.17 per cent
Germany's DAX +0.08 per cent
France's CAC 40 +0.07 per cent
Stoxx 600 +0.35 per cent
Commodities:
WTI crude oil (Nymex Apr) +0.35 per cent at $50.94 (U.S.) a barrel
Natural gas (Nymex Apr) +0.21 per cent at $2.847
Gold (Comex Apr) -0.1 per cent at $1,195.00 (U.S.) an ounce
Copper (Comex May) -0.51 per cent at $2.6390 (U.S.) a pound
Currencies:
Canadian dollar at 80.21 (U.S.), up 0.0013
U.S. dollar index up 0.421 at 96.799
Bonds:
U.S. 10-year Treasury yield 2.1191 per cent, up 0.0036
ECONOMIC INDICATORS:
Canadian merchandise trade balance for January was a deficit of $2.45-billion, far exceeding the consensus estimate for a deficit of $1-billion.
U.S. Goods and services trade deficit came in at $41.7-billion, in-line with economists' expectations.
Canadian building permits for January, forecast to fall 4.0 per cent, fell by 12.9 per cent.
(8U.S. non-farm payrolls for February rose by 295,000, beating the consensus estimate by 60,000. Average hourly earnings were expected to rise 0.2 per cent, but edged up by 0.1 per cent.
STOCKS TO WATCH:
Teck Resources Inc. had its credit rating cut to the lowest investment grade rating by Moody's, citing the company's elevated debt load and "materially negative" free cash flow.
Foot Locker Inc. posted adjusted earnings per share that exceeded every analysts' estimate, driven by fourth-quarter comparable sales that rose 10 per cent. Shares are up 3.5 per cent in the pre-market.
Staples Inc. missed on revenues but recorded better than anticipated profits in the fourth quarter and released earnings guidance in line with the Street's expectations. Shares are advancing in the pre-market.
Gap Inc. said same-store sales declined by 4 per cent in February; analysts were expecting a modest gain.
Earnings include: Trimac Transportation.
ANALYST ACTIONS:
Canadian Natural Resources Ltd. was upgraded to "buy" from "market perform" at Cormark Securities.
Lululemon Athletica Inc. was downgraded to "sell" from "neutral" at Goldman Sachs.
SNC-Lavalin Group Inc. was lowered to "market perform" from "outperform" by BMO Nesbitt Burns.
Baytex Energy Corp. was upgraded to "buy" from "hold" at Desjardins Securities.
Sprott Inc. was lowered to "hold" from "buy" at TD Securities.
Aecon Group Inc. was reduced to "market perform" from "outperform" at BMO Nesbitt Burns.
Actavis was rated new "buy" at Edward Jones.
Midway Gold Corp. was downgraded to "hold" from "buy" at Jacob Securities. The 12-month target price is 90 cents (Canadian) per share.
Pharmacyclics Inc. was downgraded to "market perform" from "market outperform" at JMP Securities and was downgraded to "market perform" from "outperform" at Wells Fargo.
George Weston Ltd. was downgraded to "hold" from "buy" at Octagon. The 12-month target price is $106 (Canadian) per share.