Equities
Canada’s main stock index opened up on Friday with with upward momentum coming from tech and financial stocks. On Wall Street, key indexes were also positive in early trading in the wake of solid results from some of the biggest U.S. lenders.
At 9:31 a.m. ET, the Toronto Stock Exchange’s S&P/TSX composite index was up 38.6 points, or 0.19 per cent, at 20,316.24. The index was up more than 2 per cent for the week heading into Friday’s session.
In the U.S., the Dow Jones Industrial Average rose 30.19 points, or 0.09 per cent, at the open to 34,425.33.
The S&P 500 opened higher by 4.57 points, or 0.10 per cent, at 4,514.61, while the Nasdaq Composite gained 28.09 points, or 0.20 per cent, to 14,166.66 at the opening bell.
All three U.S. indexes were positive for the week ahead of Friday’s opening bell.
Key on Friday will be results from U.S. big banks, including JPMorgan, Wells Fargo and Citigroup.
“On the earnings front the focus will be on the release of the Q2 numbers for JPMorgan Chase, Citigroup and Wells Fargo, and their respective views of the health of the U.S. consumer, and how much they set plan to aside in additional provisions,” Michael Hewson, chief market analyst with CMC Markets U.K., said.
“Their guidance on how they see the U.S. economy in Q3 is also likely to be crucial.”
Early Friday, JPMorgan reported that profit climbed to US$14.47-billion, or US$4.75 per share, for the quarter ended June 30. That compares with US$8.65-billion, or US$2.76 per share a year earlier.
Wells Fargo, meanwhile, said net income rose to US$4.94-billion, or US$1.25 per share, for the three months ended June 30, compared with US$3.14 billion, or US$0.75 per share, a year earlier. Citi, however, said net income fell to US$2.92-billion, or $1.33 per share, in the three months to June 30. That compares with US$4.55-billion, or US$2.19 per share, a year earlier.
All three were higher in premarket trading.
In Canada, the real estate market will get some attention with the release of June home sales figures by the Canadian Real Estate Association.
CREA said national home sales rose 1.5 per cent on a monthly basis in June. Compared with the same month a year earlier, sales rose 4.7 per cent. The number of newly listed properties was up 5.9 per cent month-over-month.
The MLS Home Price Index rose 2 per cent month-over-month but was still down 4.5 per cent year-over-year, CREA said.
Markets also got a reading on Canadian factory sales in May from Statistics Canada.
The agency said manufacturing sales rose 1.2 per cent in May, better than the 0.8-per-cent gain it had forecast earlier. However, April’s sales were revised to a decline of 0.1 per cent from the rise of 0.3 per cent originally reported.
Elsewhere, Telus Corp. cut its annual guidance for 2023, citing demand pressures as the technology sector looks to cut costs. The Vancouver-based company says it revised its guidance as a result of Telus International’s updated full-year annual outlook, The Canadian Press reported. Telus says it is now targeting consolidated operating revenue growth of 9.5 to 11.5 per cent, down from 11 to 14 per cent.
Overseas, the pan-European STOXX 600 was up 0.10 per cent by midday. Britain’s FTSE 100 gained 0.25 per cent. Germany’s DAX slid 0.14 per cent and France’s CAC 40 gained 0.35 per cent.
In Asia, Japan’s Nikkei slid 0.09 per cent. Hong Kong’s Hang Seng added 0.33 per cent.
Commodities
Crude prices were steady and looked set for a third week of gains with supply disruptions helping underpin sentiment.
The day range on Brent was US$80.95 to US$81.70 in the early premarket period. The range on West Texas Intermediate was US$76.55 to US$77.30. Both benchmarks have been up for the past three sessions and were positive for the week early Friday morning.
“Because of OPEC intervention and, more notably, Saudi Arabia’s most recent voluntary production cuts, Oil markets are looking through China’s industrial malaise and the global manufacturing sector slump – now in its 10th month of (worsening) contraction,” Stephen Innes, managing partner with SPI Asset Management, said in a note.
“At the same time, OECD labour markets and service sectors remain in relatively good health, limiting the potential for policy easing in a still elevated inflation setting.”
Prices drew some support from news that some oilfields in Libya were shut down on Thursday as a result of protests. Separately, Shell suspended loadings of Nigeria’s Forcados crude oil owing to a potential leak at a terminal, Reuters reported.
The news agency said the Libya disruption is halting an estimated 370,000 barrels per day (bpd) while the loss from the Nigerian outage is pegged at 225,000 bpd.
In other commodities, gold prices pulled back somewhat on profit taking but were still on track for the biggest weekly gain since April
Spot gold was down 0.3 per cent at US$1,954.69 per ounce by early Friday morning. Bullion is up about 1.6 per cent for the week so far. U.S. gold futures eased 0.2 per cent to US$1,959.30.
Currencies
The Canadian dollar was little changed while its U.S. counterpart held near 15-month lows against a group of world currencies on expectations the Federal Reserve’s rate hike cycle could be near a conclusion.
The day range on the loonie was 76.10 US cents to 76.38 US cents in the early premarket period. The Canadian dollar is up 1.3 per cent against the U.S. dollar over the past five days.
“The Canadian dollar has participated in the broader rally against the USD this week but gains have come grudgingly, it seems,” Shaun Osborne, chief FX strategist with Scotiabank, said. “Amongst the majors, the CAD’s 1.1-per-cent rise is the weakest and well short of its commodity peers.”
On world markets, the U.S. dollar index, which measures the U.S. currency against six peers, rose 0.03 per cent to 99.803, after hitting a 15-month low of 99.574 earlier in the session. The index is down 2.4% for the week, its biggest weekly decline in eight months, according to figures from Reuters.
The euro, meanwhile, hit a fresh 16-month high of US$1.1243 in Asian hours before flattening at US$1.1225.
In bonds, the yield on the U.S. 10-year note was higher at 3.797 per cent in the predawn period.
More company news
Canopy Growth Corp. says it has signed deals with its secured and unsecured lenders that it expects will help the cannabis company reduce its total debt by about $437-million over the next six months. The company says the moves are also expected to help lower annual interest costs by approximately $20-million to $30-million. -The Canadian Press
Economic news
(8:30 a.m. ET) Canadian manufacturing sales and new orders.
(8:30 a.m. ET) Canadian existing home sales and average prices.
(8:30 a.m. ET) U.S. import prices for June.
(9 a.m. ET) Canada’s MLS Home Price Index for June.
(10 a.m. ET) U.S. University of Michigan Consumer Sentiment Survey for July (preliminary reading)
With Reuters and The Canadian Press