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.
After the S&P 500 and Nasdaq set all-time closing highs on Friday, U.S. equity futures are trading to the upside ahead of the open.
The day is devoid of economic data, but a blockbuster earnings report from Apple Inc., the world's largest company by market capitalization, after the close will be eyed throughout the trading day and set the tone for Tuesday's session. The Street isn't expecting the tech behemoth to duplicate its previous record earnings report, calling for earnings of $2.15 per share on revenues of $55.75-billion.
"Judging by the moves in the tech giant last week, the market believes the eight consecutive quarterly earnings beats will continue," said IG chief market strategist Chris Weston. "Expect a sizeable increase to its previously announced buyback."
S&P/TSX 60 futures are also higher in the pre-market, with West Texas Intermediate futures holding most of last week's gains.
Chinese stocks spiked on reports that the government is considering combining and restructuring many of the inefficient state-owned enterprises as well as rumblings of additional monetary stimulus from the People's Bank of China. The Shanghai Composite rose more than 3 per cent.
Japanese stocks finished with modest losses. In reflection of the lack of fiscal measures to offset the delay of the consumption tax hike, the ratings agency Fitch downgraded Japan's credit rating to A from A+. This move is unlikely to have much of an impact on the nation's borrowing costs, which remain paltry despite a high level of debt relative to its gross domestic product.
European finance ministers appear to be fed up with Greece's Yanis Varoufakis. According to the Financial Times, the Greek finance minister is "increasingly isolated" and prime minister Alexis Tsipras is likely to play a larger role in future negotiations. Athens has yet to reach an agreement with its creditors on reforms that would be palatable to both sides and allow Greece to access more aid. And with an election in the United Kingdom less than two weeks away, Greece isn't the only source of political uncertainty within the European Union.
Major European bourses, however, remain in positive territory on Monday.
Here's a look at the latest market numbers and other highlights ahead of the trading day.
Futures:
S&P 500 +0.21 per cent; Dow +0.25 per cent; Nasdaq +0.23 per cent
Equities:
Hong Kong's Hang Seng +1.33 per cent
Shanghai composite index +3.04 per cent
Japan's Nikkei -0.18 per cent
London's FTSE 100 +0.3 per cent
Germany's DAX +1.0 per cent
France's CAC 40 +0.59 per cent
Stoxx 600 +0.48 per cent
Commodities:
WTI crude oil (Nymex Jun) -0.16 per cent at $57.06 (U.S.) a barrel
Natural gas (Nymex May) -2.17 per cent at $2.476
Gold (Comex Jun) +0.78 per cent at $1,184.20 (U.S.) an ounce
Copper (Comex Jul) +0.33 per cent at $2.762 (U.S.) a pound
Currencies:
Canadian dollar at 82.21 (U.S.), up 0.0012
U.S. dollar index up 0.23 at 97.152
Bonds:
U.S. 10-year Treasury yield 1.9138 per cent, up 0.0052
STOCKS TO WATCH:
Precision Drilling Corp. reported better than expected first quarter results on both the top and bottom lines. However, profits were down by more than 75 per cent relative to the same period in 2014, and management indicated that it had cut its work force by nearly 30 per cent since the end of 2014.
Restaurant Brands International Inc. reported adjusted earnings per share of 18 cents in the first quarter, three cents above the consensus estimate, according to Bloomberg, though revenues came in a bit light. Same-store sales growth for both Burger King and Tim Hortons increased by more than analysts had anticipated.
Shares of Applied Materials Inc. are down in the pre-market session after the company gave up its quest to acquire Tokyo Electron Ltd., a business combination that was opposed by the U.S. Department of Justice due to antitrust concerns.
The F-35 engines produced by United Technologies Corp. have been deemed to have "very poor" reliability, according to the Government Accountability Office.
Earnings expected Monday include: Barrick Gold, PrairieSky, Precision Drilling, Restaurant Brands, Advent Software Inc, Apple Inc.,Barracuda Networks Inc.,Berkshire Hills Bancorp Inc., Boston Ppties Inc., Churchill Downs Inc., Compass Minerals, Homestreet Inc., J & J Snack Foods Corp., Jones Lang LaSalle, PMC-Sierra Inc., Seaspan Corp., Southern Copper Corp., SS&C Tech Inc., The Container Store Grp Inc, Universal American Corp. , Wabash Natl Corp., Waste Connections Inc.
ANALYST ACTIONS:
Brean Capital initiated coverage on Apple Inc. with a "buy" rating and price target of $160 (U.S.).
Procter & Gamble Co. was lowered to "underperform" from "outperform" at CLSA.
Texas Instruments Inc. was upgraded to "strong buy" from "market perform" at Raymond James