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. equities futures are rising to begin this shortened week, after Chinese policymakers hinted over the weekend that additional monetary stimulus measures could be on the way.
Zhou Xiaochuan, head of the People's Bank of China, said that growth was slowing "a bit too sharply" and that monetary policy had room to reduce rates, or allow for other options, as the nation looks to transition to growth driven by domestic demand rather than credit-fuelled infrastructure spending.
The personal consumption expenditures index, the Federal Reserve's preferred gauge of inflation, rose 1.4 per cent in February, according to data released this morning. That was close to market expectations. With the central bank eschewing forward guidance, economic data – and particularly the core inflation rate, which strips out the effect of energy prices – will be key in determining when federal funds rate will be lifted from zero.
West Texas Intermediate futures are trading around $48 (U.S.) per barrel this morning due to the stronger U.S. dollar and the potential for more crude oil to be unleashed onto the market.
Iran is less than 48 hours away from a possible deal on its nuclear program. An accord would likely involve the lifting of sanctions, which in turn would enable the country to export more crude oil and exacerbate the global supply glut.
S&P/TSX 60 futures are slightly lower in light of this weakness in energy.
Chinese stocks were up on stimulus hopes as well as a move from the central bank to prop up the nation's flagging real estate market. The People's Bank of China cut the minimum downpayment required for a second home to 40 per cent from 60 per cent. Property stocks spiked on the news.
Japan's Nikkei finished with more modest gains.
Meanwhile, Europe is focused on preliminary inflation data and the ongoing saga with the Greek debt talks.
The initial reading for March showed Spanish inflation fell by 0.7 per cent year-over-year, a smaller-than-anticipated contraction.
Greece submitted a general outline of its reform plans to its creditors before the weekend, but is expected to provide a more formal list on Monday.
"[This list] still lacks details in some areas that have caused concerns during previous discussions, and it still fails to include progress in labour market and pension reforms," wrote Barclays' European economics team.
The country is in danger of running out of funds in three weeks without further assistance.
Here's a look at the latest market numbers and other highlights ahead of the trading day.
Futures:
S&P 500 +0.46 per cent; Dow +0.58 per cent; Nasdaq +0.66 per cent
Equities:
Hong Kong's Hang Seng +1.51 per cent
Shanghai composite index +2.59 per cent
Japan's Nikkei +0.65 per cent
London's FTSE 100 +0.37 per cent
Germany's DAX +1.35 per cent
France's CAC 40 +1.03 per cent
Stoxx 600 +0.83 per cent
Commodities:
WTI crude oil (Nymex May) -1.41 per cent at $48.18 (U.S.) a barrel
Natural gas (Nymex May) -0.72 per cent at $2.62
Gold (Comex Apr) -1.39 per cent at $1,184.00 (U.S.) an ounce
Copper (Comex May) +0.25 per cent at $2.7745 (U.S.) a pound
Currencies:
Canadian dollar at 79.08 (U.S.), down 0.002
U.S. dollar index up 0.536 at 97.827
Bonds:
U.S. 10-year Treasury yield 1.9492 per cent, down 0.0122
ECONOMIC INDICATORS:
Canadian industrial production in February rose 1.8 per cent from January versus Street expectations for a rise of 0.9 per cent.
The U.S. personal consumption expenditures index rose 1.4 per cent in February versus expectations for 1.3 per cent. It rose 1.3 per cent in January.
U.S. personal income rose 0.4 per cent in February. Consensus was for a 0.3-per-cent rise.
U.S. personal spending edged up 0.1 per cent in February after an unrevised 0.2 per cent drop in January. Economists were expecting a rise of 0.2 per cent.
(10 a.m. ET) U.S. pending home sales. Consensus is an increase of 0.4 per cent in February.
STOCKS TO WATCH:
Best Buy Co. announced that it was closing half of its Future Shop locations in Canada and re-branding the other half under the "Best Buy" banner. Management indicated that this will result in a impairment charges between $250 to $350-million.
A subsidiary of UnitedHealth Group Inc. will purchase Catamaran Corp. for $12.8-billion in cash, a 27 per cent premium to the company's closing price on Friday. This transaction is expected to close in the final three months of the year. Catamaran shares are up about 25 per cent in the premarket.
Horizon Pharma Plc jumped 7 per cent in premarket trading after agreeing to buy Hyperion Therapeutics Inc. for $1.1-billion. Hyperion, whose holders will receive $46 a share in cash, rallied 6.6 per cent.
Bombardier Inc. has won a 10-year fleet maintenance contract for Uk's Essex Thameside franchise valued at $213-million (U.S.).
Canexus Corp. indicated that its Calgary head office and NATO staff have been "reduced significantly" in an attempt to cut costs, and that its credit facility lenders have further relaxed financial covenants for the first half of 2015.
Altera Corp. shares are up 2 per cent in premarket trading. The chipmaker's shares surged 28 per cent on Friday amid reports Intel Corp. is in talks to acquire it. The purchase would make sense from manufacturing and strategic perspectives, Jefferies Group LLC said late on Friday.
Earnings include: Callidus Capital, Claude Resources, Enterprise Group, Intermap, SouthGobi Resources, Argos Therapeutics Inc., Cypress Energy Partners, Danaos Corp., Fifth Street Asset Management, Norcraft Cos., Puma BioTech Inc., Stemline Therapeutics Inc., UTi Worldwide Inc., Willbros Group.
ANALYST ACTIONS:
RBC Dominion Securities upgraded Oracle to "outperform" from "sector perform" and raised its price target to $50 (U.S.) from $48.
RBC Dominion Securities cut its price target on Savanna Energy Services to $2.50 (Canadian) from $4 and maintained a "sector perform" rating.
Canaccord Genuity upgraded Kraft Foods Group to "buy" from "hold" and raised its price target to $96 (U.S.) from $70.
Legacy Oil + Gas Inc. was lowered to "hold" from "buy" at Desjardins Securities.
Nike Inc. was raised to "outperform" from "neutral" at Robert Baird.
West Fraser Timber Co. Ltd., Canfor Corp., and Interfor Corp. were all initiated with a rating of "market perform" by BMO Nesbitt Burns.