With investors digesting a mixed round of earnings reports from North America, US index futures are down across the board with Dow futures falling 0.6% and NASDAQ futures diving 1.3%. In Europe today, the Dax is down 0.5% and the FTSE is down 0.3%. Energy trading is mixed with WTI crude oil up 0.3% and Natural Gas down 5.4%, while in metals action, copper and gold are both down about 0.5%.
The NASDAQ has been dragged lower by weaker than expected sales guidance from Microsoft, which offset better than expected earnings ($2.32 vs street $2.29, down 2.7% premarket). Other US earnings reports have been mixed. Texas Instruments beat the street ($2.13 vs street $1.98), but railroad Union Pacific ($2.64 vs street $2.77), and Boeing (-$1.75 vs street +$0.26, down 2.3% premarket) posted disappointing results. Tesla Motors and IBM are this afternoon’s headliners. In Canada, CN Rail beat expectations ($2.10 vs street $2.08), results from Celestica are due later today.
The Bank of Canada’s latest monetary policy decision is due at 10:00 am EST with the central bank expected to announce a 0.25% rate hike to 4.50%, slowing the pace from 0.50% last time. Investors may look to the statement for hints of how many more interest rate increases may be needed before a pause and how long rates may remain elevated. Comments related to inflation, employment and the economic environment may also influence speculation on the future of interest rates. This decision and commentary may also help to set the tone of anticipation for next Wednesday’s Fed meeting in the US.
SIA Wealth In The Media:
Chief Market Strategist Colin Cieszynski recently appeared on BNN Bloomberg where he spoke about tactical rotation in equity markets, today’s Bank of Canada decision, earnings season and recent technical action in the S&P/TSX Composite Index.