Equities
Wall Street futures were down in early trading Tuesday ahead of a key reading on U.S. inflation. Major European markets were in the red. TSX futures were modestly lower.
In the early premarket period, Dow, S&P and Nasdaq futures were all underwater. On Monday, the Dow rose 0.33 per cent to hit a record high, although the S&P and Nasdaq both saw losses on the day. Canada’s S&P/TSX Composite Index finished yesterday up 0.27 per cent.
Ahead of the start of trading, markets will get a reading on U.S. inflationary pressures in January, with the release of the consumer price index for that month. Economists surveyed by Reuters are expecting the overall rate of inflation to have eased to 2.9 per cent, down from 3.4 per cent in December.
“Coming off the back of a period that has seen the Federal Reserve consistently reigning in market expectations over the timing and scope of their 2024 rate cuts, today’s expected slide in U.S. CPI could be a short reprieve from that trend,” Josuha Mahony, chief market analyst with Scope Markets, said.
“With the 0.5-per-cent reading from last January dropping out of the annual metric, base effects should help provide the basis for a welcome decline in inflation today. However, the wider picture remains problematic, with the pathway back to [the inflation target of] 2 per cent looking far from simple.”
In Canada, markets get more earnings, with results from Shopify and Tim Hortons parent Restaurant Brands International before the start of trading. Results are also due from Hydro One and Intact Financial. On Wall Street, Coca-Cola and Hasbro report.
Restaurant Brands International beat analysts’ revenue forecasts in the most recent quarter. The company, which also operates Burger King, posted total revenue rose to US$1.82-billion in the fourth quarter from US$1.69-billion a year earlier, compared with analysts’ average estimate of US$1.81 billion, according to LSEG IBES data.
Shopify, meanwhile, reported total revenue of US$2.14-billion for the three months to December, compared with analysts’ average estimate of US$2.08-billion, according to LSEG data.
Elsewhere, The Globe’s Alexandra Posadzki reports this morning that Rogers Communications Inc. president of residential operations Zoran Stakic has left the company, triggering a series of changes in the telecom giant’s leadership ranks. Mr. Stakic, a former Shaw Communications Inc. executive, joined Rogers Communications Inc. during its takeover of its Calgary-based rival.
Overseas, the pan-European STOXX 600 was down 0.26 per cent in morning trading. Britain’s FTSE 100 slid 0.07 per cent. Germany’s DAX lost 0.64 per cent while France’s CAC 40 fell 0.35 per cent.
In Asia, Japan’s Nikkei jumped 2.89 per cent, briefly touching the 38,000 level during intraday trading. Markets in Hong Kong were closed.
Commodities
Crude prices were higher early Tuesday with markets awaiting U.S. inventory data later in the day as heightened tensions in the Middle East continue to drive sentiment.
The day range on Brent was US$81.96 to US$82.73 in the early premarket period. The day range on West Texas Intermediate was US$76.87 to US$77.68.
“Note that rising oil prices are a double-edged sword,” Swissquote analyst Ipek Ozkardeskaya said in a note.
“Good growth is positive for oil prices, but higher oil prices are not good for easing inflation. Hence, any U-turn in inflation would get the major central banks to further tighten their purses’ strings, hit growth prospects and hammer a potential oil rally.”
Reuters reports that the conflict in the Middle East has kept prices elevated, as the U.S. and Jordan maintained pressure for a Gaza Strip ceasefire. Senior mediators were to resume work on Tuesday on an Israel-Hamas truce agreement.
Meanwhile, the American Petroleum Institute is scheduled to release its weekly inventory report later in the session. More official government numbers will follow on Wednesday morning. Analysts are expecting to see a rise in U.S. crude stocks of about 2.6 million barrels last week.
Markets also got OPEC’s monthly market report Tuesday. The International Energy Agency’s report for the month is due on Thursday. OPEC said it expects world oil demand will rise by 2.25 million barrels a day in 2024 and by 1.85 million barrels a day in 2025. Both forecasts were unchanged from last month.
In other commodities, spot gold was up 0.2 per cent to US$2,023.89 per ounce by early Tuesday morning, after briefly slipping to a more than two-week low of US$2,011.72 on Monday. U.S. gold futures also ticked up 0.2 per cent to US$2,037.50.
Currencies
The Canadian dollar was little changed while its U.S. counterpart was mostly steady against a basked of world currencies.
The day range on the loonie was 74.26 US cents to 74.37 US cents in the early premarket period.
The U.S. dollar index, which weighs the greenback against a group of currencies, was little changed at 104.16 ahead of the release of the latest U.S. inflation data.
The euro was up 0.02 per cent at US$1.0775. Britain’s pound rose 0.33 per cent to US$1.2669.
In bonds, the yield on the U.S. 10-year note was slightly higher at 4.181 per cent in the predawn period.
More company news
Hasbro reported a steeper-than-expected drop in holiday-quarter sales and profit on Tuesday, as a persistent demand weakness in the toy industry weighed on sales of the company’s digital and board games. Sluggish demand from a pullback in leisure spending and cautious inventory planning by retailers like Walmart and Target hurt Hasbro’s sales in the past year. For the full year 2024, the company expects revenue in its core Wizards of the Coast segment to be down 3% to 5%, owing to weakness in digital gaming. -Reuters
Coca-Cola beat Wall Street expectations for fourth-quarter revenue on Tuesday, as the beverage maker benefited from higher product prices and buoyant demand for its namesake drink and juices. The company’s net revenue rose to US$10.95-billion in the quarter compared with US$10.20-billion a year earlier, while analysts estimated US$10.68-billion, according to LSEG data. -Reuters
Economic news
(8:30 a.m. ET) U.S. CPI for January.
With Reuters and The Canadian Press
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2024-02-13 10:30:52Z
CBMie2h0dHBzOi8vd3d3LnRoZWdsb2JlYW5kbWFpbC5jb20vaW52ZXN0aW5nL21hcmtldHMvaW5zaWRlLXRoZS1tYXJrZXQvYXJ0aWNsZS1mZWJydWFyeS0xMy1iZWZvcmUtdGhlLWJlbGwtY2FuYWRpYW4taW52ZXN0b3JzL9IBAA
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