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. equity futures are poised to pare some of Wednesday's gains amid another busy day of corporate earnings.
Heavyweights such as Amazon.fom Inc., Google Inc., and Microsoft Corp. are slated to post their quarterly results on Thursday after regular trading hours are over.
Underwhelming results from Facebook Inc. and poor guidance from Qualcomm Inc. and Texas Instruments Inc. after the close on Wednesday appear to be weighing on sentiment this morning.
Earnings season has, by and large, yielded better than anticipated results thus far, though positive surprises on the top line have been more difficult to come by. Most multinational companies have highlighted that the stronger U.S. dollar has crimped revenue growth, perhaps by more than analysts had anticipated.
S&P/TSX 60 futures are also lower ahead of the open, with West Texas Intermediate futures continuing to trade in a relatively tight range above $55 (U.S.) per barrel.
European stocks are also moving lower amid softening economic data.
However, the euro zone flash composite purchasing managers' index indicated that the growth of business activity slowed in April, thanks to weaker expansions in France and Germany despite strong performance outside of the core.
"The weaker rate of expansion is a big disappointment, given widespread expectations that the ECB's quantitative easing will have boosted the fledgling recovery seen at the start of the year," said Markit chief economist Chris Williamson. "However, it's too early to draw firm conclusions about whether growth is faltering again and the effectiveness of policy."
Retail sales in the United Kingdom also recorded an unexpected decline in March.
However, concerns over a possible Grexit are moderating five years to the day after the highly indebted nation submitted its first bailout request, with yields on Greek debt falling ahead of the meeting of Euro group finance ministers on Friday. On Wednesday evening, Bloomberg reported that the European Central Bank had boosted the amount of emergency funds that Greece's central bank can extend to domestic financial institutions.
China's flash manufacturing PMI showed even more weakness, falling to a one-year low of 49.2 in April, with new orders falling at a more rapid pace than in March.
"Production increased only marginally, while total new business declined for the second successive month," said Annabel Fiddes, economist at Markit. "Meanwhile, job shedding across manufacturing firms was recorded for the 18th month in a row."
Despite this, Japan's Nikkei posted another day of solid gains, fuelled by an improved earnings and revenue outlook provided by Sony Corp. for its fiscal 2015.
Here's a look at the latest market numbers and other highlights ahead of the trading day.
Futures:
S&P 500 -0.33 per cent; Dow -0.31 per cent; Nasdaq -0.33 per cent
Equities:
Hong Kong's Hang Seng -0.4 per cent
Shanghai composite index +0.36 per cent
Japan's Nikkei +0.27 per cent
London's FTSE 100 +0.08 per cent
Germany's DAX -1.16 per cent
France's CAC 40 -0.79 per cent
Stoxx 600 -0.66 per cent
Commodities:
WTI crude oil (Nymex Jun) -0.45 per cent at $55.91 (U.S.) a barrel
Natural gas (Nymex May) -1.04 per cent at $2.579
Gold (Comex Jun) +0.22 per cent at $1,189.40 (U.S.) an ounce
Copper (Comex Jul) +0.54 per cent at $2.6915 (U.S.) a pound
Currencies:
Canadian dollar at 81.81 (U.S.), up 0.0011
U.S. dollar index up 0.051 at 97.983
Bonds:
U.S. 10-year Treasury yield 1.9524 per cent, down 0.0263
ECONOMIC INDICATORS:
(8:30 a.m. ET) U.S. initial jobless claims for the week of April 18 came in at 295,000, defying expectations for an improvement to 290,000.
(10 a.m. ET) U.S. new home sales for March. Consensus is 510,000, a decline of 4 per cent from February
(4 p.m.) Ontario budget released
STOCKS TO WATCH:
Eli Lilly & Co. posted adjusted earnings per share of 87 cents (U.S.) for the first three months of the year, 11 cents higher than the consensus call. However, revenues fell by 1 per cent relative to the same period in 2014, the sixth consecutive decline, as the stronger U.S. dollar took its toll on sales made abroad.
Qualcomm Inc. reported better than anticipated profits and revenues for its fiscal second quarter after the market closed on Wednesday. However, the chipmaker and licenser is targeting much lower top and bottom line performance for the full year than analysts had anticipated, leaving shares lower in the pre-market trade.
Caterpillar Inc. posted earnings well above the Street's estimate in the first quarter, with revenues exceeding expectations by a more modest margin. The company also boosted its full-year guidance, helping to send shares higher in the pre-market.
3M Co. reported profits and sales that came in shy of the consensus estimate. The company also lowered its full-year guidance, blaming the U.S. dollar's strength, as more than half of its revenues are generated outside the United States. Shares are trading to the downside in the pre-market.
PepsiCo Inc. booked higher than anticipated profits in the first-quarter thanks in large part to strong cost controls. Shares initially rose in the pre-market session, but have since moved into the red.
Procter & Gamble Co. recorded first-quarter earnings in line with analysts' estimates, though revenues came in light. Management attributed the top-line miss to the stronger U.S. dollar. Shares moved modestly lower in the pre-market trade.
General Motors Co. reported lower than expected profits for the first-quarter, but reaffirmed its full-year guidance. The automaker has elected to scale down its Russia operations, and took an impairment charge related to this restructuring. Shares are well in the red in the pre-market session.
Earnings expected Thursday include: 3M Company; AbbVie Inc.; Altera Corp.; Amazon.com Inc.; BB&T Corp.; Briggs & Stratton Corp.; Capital One Financial Corp.; Carter's Inc.; Caterpillar Inc.; Chubb Corp.; CRH Medical Corp.; Danaher Corp.; Dow Chemical Co.; Dr Pepper Snapple Grp Inc.; Dunkin' Brands Grp Inc.; E*TRADE Financial Corp.; First American Financial Corp.; General Motors Co.; Google Inc.; Hammond Power Solutions Inc.; Janus Capital Grp Inc.; Juniper Networks Inc.; MDC Partners Inc.; Microsoft Corp.; NetSuite Inc.; PepsiCo Inc.; Polaris Indus Inc. ; Procter & Gamble Co.; Southwest Airlines Co.; Uranium Participation Corp.; Wall Financial Corp.; West Fraser Timber Co. Ltd.; Winpak Ltd.
ANALYST ACTIONS:
Potash Corp. was upgraded to "buy" from "hold" at HSBC.
Enbridge Inc. was lowered to "neutral" from "outperform" at Credit Suisse.
Metro Inc. was raised to "buy" from "hold" at Desjardins Securities.
A trio of drilling firms were downgraded by Morgan Stanley. Transocean Inc., Ensco PLC, and Noble Corp. were all cut to "underweight" from "equal weight."
Texas Instruments Inc. was lowered to "neutral" from "buy" at Bank of America.