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Equities
Indexes on both sides of the border fell early Thursday with a disappointing forecast from Facebook-parent Meta Platforms taking a toll on the tech sector.
At 9:34 a.m. ET, the Toronto Stock Exchange’s S&P/TSX composite index was down 236.88 points, or 1.11 per cent, at 21,125.48.
In the U.S., the Dow Jones Industrial Average fell 109.2 points, or 0.31 per cent, at the open to 35520.08.
The S&P 500 fell 54.0 points, or 1.18 per cent, at the open to 4535.41, while the Nasdaq Composite dropped 371.7 points, or 2.58 per cent, to 14045.834 at the opening bell.
Early Thursday, sentiment took a hit after Meta Platforms, which owns Facebook, issued a weaker-than-expected forecast, citing Apple Inc.’s privacy changes and increased competition. Facebook’s global daily active users declined from the previous quarter for the first time, to 1.929 billion from 1.930 billion. The results were released after Wednesday’s close. The company’s stock was down more than 24 per cent in early trading.
After Thursday’s close investors will get results from Amazon.com Inc., the last of the FAANG stocks to report results.
“The company [Amazon] is expected to reveal a second consecutive month of earnings decline. Ouch,” Swissquote senior analyst Ipek Ozkardeskaya said in an early note.
Ford Motor Co. also reports after the close.
In this country, investors got results from BCE Inc. before the start of trading.
The telecom giant said revenue rose 1.8 per cent in the latest quarter to $6.21-billion. BCE reported $658-million in net income for the three month period ended Dec. 31, down 29 per cent from $932-million during the same quarter last year. After adjusting for certain items such as severance, acquisitions and other costs, the earnings amounted to 76 cents per share. Analysts had been expecting $6.23-billion of revenue and 73 cents per share of adjusted profits, according to S&P Capital IQ. The company also said it will pay a quarterly dividend of 92 cents per common share, up from 87.5 cents per share. Shares were up nearly 1 per cent in early trading.
Elsewhere, Canadian energy giant Suncor Energy Inc. swung to a profit in the latest quarter but still came up short of analysts’ estimates.
The Calgary-based company reported net profit of $1.55-billion, or $1.07 per share, versus a loss of $168 million, or 11 cents per share, a year earlier. Adjusted for one-time items, Suncor earned 89 cents per share, compared with expectations for 94 cents, according to Refinitiv data. The results were released after the end of trading on Wednesday. Suncor shares were down about 4 per cent in morning trading in Toronto.
Overseas, the pan-European STOXX 600 was down 0.61 per cent by midday. Britain’s FTSE 100 fell 0.25 per cent. Germany’s DAX and France’s CAC 40 were off 0.48 per cent and 0.11 per cent, respectively. Early Thursday, the Bank of England announced it would raise interest rates to 0.5 per cent, although four of nine policymakers wanted a bigger increase. The European Central Bank kept rates unchanged, as expected.
In Asia, Japan’s Nikkei fell 1.06 per cent.
Commodities
Crude prices pulled back from recent highs but remained supported by tight supply and a decision by OPEC+ to continue with its current plan of production increases.
The day range on Brent is US$88.52 to US$89.50. The range on West Texas Intermediate is US$87.20 to US$88.14. Both benchmarks saw modest gains on Wednesday but were down about 1 per cent in the predawn period.
At a meeting Wednesday, members of the OPEC+ group agreed to stick with their current production plan of moderate 400,000 barrel-a-day increases, despite pressure to ramp up output to head of high prices.
“[The] meeting on output ended quickly, which means OPEC+ quickly shrugged away pressure from the Biden administration to significantly boost output and stuck to the gradual production increase strategy,” OANDA senior analyst Ed Moya said.
“OPEC+ will save larger-than-expected production promises for when oil is over $100 a barrel.”
Prices, however, came under some pressure after Iran’s oil minister reiterated that the country is ready to boost supply to the market as quickly as possible, Mr. Moya said in a note.
Meanwhile, the U.S. Energy Information Administration’s latest inventory figures offered some support for prices. U.S. crude stockpiles fell by 1 million barrels last week, the EIA said. Distillate inventories also fell.
In other commodities, gold prices were relatively steady, holding around US$1,800 an ounce.
Spot gold eased 0.2 per cent to US$1,803 an ounce by early Thursday, after hitting US$1,810.86 in the previous session, its highest since Jan. 27. U.S. gold futures fell 0.3 per cent to US$1,804.90.
“Rate expectations are the primary driver of gold right now,” IG Markets analyst Kyle Rodda said.
“There’s been some reprieve for gold in recent days from some comments from a handful of Fed speakers, who have hosed down some fears of aggressive tightening.”
Currencies
The Canadian dollar was lower, tracking weaker global risk sentiment and declining crude prices, while its U.S. counterpart edged up against a group of world currencies after three down days.
The day range on the loonie is 78.66 US cents to 78.95 US cents.
There were no major Canadian economic releases due Thursday. Investors in both Canada and the U.S. are awaiting new jobs figures, due early Friday.
On world markets, the U.S. dollar index, which measures the greenback against six rivals, edged 0.06% higher to 96.088, after falling for three days in a row.
The euro was marginally weaker at US$1.1296, after rising around 2 per cent in the last three sessions, according to figures from Reuters.
Britain’s pound ticked higher against the euro while falling 0.2 per cent versus the U.S. dollar ahead of the Bank of England policy decision.
More company news
Shell reported on Thursday a sharp rise in fourth-quarter profits to US$6.4-billion, beating forecasts, lifted by soaring oil and natural gas prices as global economic activity picked up. Fourth-quarter 2021 adjusted earnings rose by 55 per cent from the previous quarter to US$6.4-billion, well above an average analyst forecast provided by the company for a US$5.2-billion profit. That compares with earnings of US$393-million a year earlier. Shell also said it expected to increase its dividend by 4 per cent in the first quarter of 2022 to US$0.25 per share.
Economic news
(8:30 a.m. ET) U.S. initial jobless claims for week of Jan. 29.
(8:30 a.m. ET) U.S. productivity for Q4.
(9:45 a.m. ET) U.S. Markit Services and Composite PMI for January.
(10 a.m. ET) U.S. factory orders for December.
(10 a.m. ET) U.S. ISM Services PMI for January.
With Reuters and The Canadian Press