Morning Minutes

Investors Focus on Earnings News, Bank of Canada Decision

Tiff Macklem, Dean, Rotman School of Management, speaks during the Machine Learning and the Market for Intelligence conference held by the Creative Destruction Lab at the Rotman School of Management in Toronto, ON on Wednesday October 25, 2017. (Laura Pedersen Photo)
Tiff Macklem, Dean, Rotman School of Management, speaks during the Machine Learning and the Market for Intelligence conference held by the Creative Destruction Lab at the Rotman School of Management in Toronto, ON on Wednesday October 25, 2017. (Laura Pedersen Photo)



US index futures are mixed this morning trading between a loss of 0.4% for NASDAQ futures and a gain of 0.3% for Dow futures as investors assess a flurry of overnight earnings reports. The Dax and FTSE are up 0.2%-0.4% along with US and Brent Crude Oil. Copper is down 0.5%, Gold is flat and Bitcoin is up another 1.6% building on Tuesday’s big rally. Markets have moved up moderately as the morning has progressed.  

Overnight earnings reports, and the street reaction to them, have been mixed. Big Tech had a split decision with Microsoft gaining 3.8% in premarket trading after beating expectations on earnings ($2.99 vs street $2.65). Alphabet, parent of Google, on the other hand, beat the street on earnings and sales but is down 6.0% premarket after cloud-based revenue fell short of expectations, which suggests that in some cases, traders seem to be digging around for any excuse to make an exit. In other news, Visa ($2.33 vs street $2.25) beat the street, while Boeing (-$3.26 vs street -$2.96) posted worse than expected results and cut its 737 Max production forecast but is up 3.8% in premarket action. Meta Platforms and IBM headline US results after the close today.

In Canada last night, First Quantum Minerals ($0.71 vs street $0.37) beat market expectations, while Canadian National Railway ($1.69 vs street $1.71) missed slightly. Results from Canadian Pacific and Agnico-Eagle are due after the close this afternoon.   

The Bank of Canada is widely expected to hold its benchmark interest rate at 5.00% when it announces its latest monetary policy decision at 10:00 am EDT, while continuing its program to steadily reduce the size of its balance sheet. Investors may look to comments in the statement related to the economy, inflation or monetary policy for color on the North American economy heading toward next week’s Fed meeting.  

SIA Wealth In The Media

Colin Cieszynski, CFA, CMT, Portfolio Manager and Chief Market Strategist recently appeared on BNN Bloomberg and spoke on a number of topics including relative strength, why SIA Wealth recently moved to 25% cash in advised portfolios and earnings season. Replays include:

Any time you get a slowdown or cost creep in mining, it’s going to get attention: Strategist

It’s not unusual for transportation stocks to struggle when energy prices are up: Market strategist

We’re not playing catchup on rates like Europe where they need to be where we are: Strategist

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Colin Cieszynski, Chief Market Strategist

Colin Cieszynski, CFA, CMT
Chief Market Strategist
+1 (647) 282-4428

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