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Bay Street Likely To Open On Mixed Note
(RTTNews) - Canadian shares are likely to open on a mixed note Wednesday morning, reacting to corporate earnings updates and key economic data from the U.S. Energy stocks may move up on firm crude oil prices.
Ivanhoe Mines Ltd. (IVN.TO) reported a net profit of $108 million for the third-quarter of 2024, compared with $67 million in the second-quarter.
Capital Power Corporation (CPX.TO) reported net income of $178 million for the quarter ended September 30, 2024, compared with $272 million in the year-ago quarter.
Secure Energy Services (SES.TO) reported a net income of $94 million for the third-quarter this year, compared with $47 million in the year-ago quarter.
Methanex Corporation (MX.TO) announced today the successful syndication of acquisition financing to support the earlier announced agreement to acquire OCI Global's international methanol business for $2.05 billion.
After a weak start and a subsequent modest upmove, the Canadian market retreated Tuesday morning and spent the rest of the day's session in negative territory as investors digested quarterly earnings updates from Canadian and U.S. companies and awaited some crucial economic data for directional cues.
The benchmark SP/TSX Composite Index ended down 3.11 points or 0.01% at 24,562.55. The index touched a low of 24,461.86 and a high of 24,591.36 intraday.
Asian stocks ended broadly lower on Wednesday, as earnings from Google parent Alphabet and chipmaker AMD proved to be a mixed bag and the European Union announced the imposition of additional tariffs on electric vehicles imported from China, prompting an angry response from Beijing.
Caution ahead of key U.S. economic data due this week and next week's presidential election also kept investors on the sidelines.
European stocks are notably lower with investors digesting the latest batch of earnings announcements and economic data, and looking ahead to the U.K. government's budget.
In commodities, West Texas Intermediate crude oil futures are up $0.84 or 1.23% at $68.05 a barrel.
Gold futures are up $7.80 or 0.28% at $2,788.90 an ounce, while Silver futures are down $0.296 or 0.86% at $34.145 an ounce.
European Shares Decline Ahead Of Key GDP Data
(RTTNews) - European stocks traded lower on Wednesday as investors assessed a batch of mixed earnings and awaited regional growth data as well as the U.K. government's budget for direction.
U.K. Chancellor of the Exchequer will present her Autumn Budget 2024 to Parliament at 8.30 am ET.
The pan European STOXX 600 dropped 0.7 percent to 514.17 after falling 0.6 percent on Tuesday.
The German DAX dipped half a percent, France's CAC 40 lost 1.1 percent and the U.K.'s FTSE 100 was down 0.4 percent.
UBS gained 1.3 percent. The Swiss banking giant reported a significant uptick in its third-quarter performance, driven by cost-cutting and robust loan income.
Bearings maker SKF surged 5.2 percent after selling its Hanover, Pennsylvania ring and seal operation, via subsidiary PCTI, to Carco PRP for 2.3 billion Swedish crowns ($215.98 million).
GSK shares tumbled 3.4 percent in London. The pharmaceutical company swung into a loss in the third quarter and lowered its 2024 vaccine sales forecast.
Standard Chartered rallied 3 percent. The lender upgraded its 2024 income guidance after profits in the third quarter beat market estimates.
Miner Glencore added 1.7 percent as it maintained production forecast for the current year.
Retail bellwether Next gained 1.6 percent after raising outlook for third time in three months.
Luxury stocks fell, with LVMH, Kering and Hermes falling 1-3 percent in Paris on concerns about demand growth in China.
Energy-management and automation group Schneider Electric rose about 1 percent after third-quarter revenue rose to record levels.
Capgemini plunged 7.6 percent as the IT consulting group cut its 2024 revenue target for the second time this year.
German automaker Volkswagen rallied 2 percent after backing its annual sales guidance.
Daimler Truck Holding fell 1.3 percent after an announcement that it is writing off some of its receivables in China.
Euro Rises Against Majors
(RTTNews) - The euro strengthened against other major currencies in the European session on Wednesday.
The euro rose to a 3-month high of 166.21 against the yen and a 2-day high of 0.8343 against the pound, from early lows of 165.59 and 0.8314, respectively.
Against the U.S. dollar and the Swiss franc, the euro advanced to 9-day highs of 1.0859 and 0.9405 from early lows of 1.0813 and 0.9371, respectively.
If the euro extends its uptrend, it is likely to find resistance around 167.00 against the yen, 0.84 against the pound, 1.10 against the greenback and 0.95 against the franc.
Pound Falls Against Majors
(RTTNews) - The British pound weakened against other major currencies in the European session on Wednesday.
The pound fell to nearly a 2-week low of 0.8354 against the euro, from an early high of 0.8314.
Moving away from an early 9-day high of 1.3027 against the U.S. dollar, the pound dropped to 1.2695.
Against the Swiss franc and the yen, the pound edged down to 1.1243 and 198.27 from early highs of 1.1291 and 199.58, respectively.
If the pound extends its downtrend, it is likely to find support around 0.84 against the euro, 1.28 against the greenback, 1.11 against the franc and 194.00 against the yen.
German Economy Avoids Recession In Q3
(RTTNews) - The German economy avoided a technical recession in the third quarter, thanks to household and government consumption, preliminary estimate from Destatis showed Wednesday.
Gross domestic product grew 0.2 percent from a quarter ago, confounding expectations for a contraction of 0.1 percent. However, the statistical office downwardly revised the fall for the second quarter to 0.3 percent from 0.1 percent.
With the latest growth, the largest euro area economy avoided a technical recession.
On a yearly basis, calendar-adjusted GDP logged an expansion of 0.2 percent, reversing the second quarter's 0.3 percent decline and confounded expectations for a drop of 0.3 percent.
Meanwhile, the price-adjusted GDP grew 0.2 percent on year, following a 0.1 percent rise in the prior quarter. Detailed results will be released on November 22.
Data published by the Federal Employment Agency today showed that the unemployment rate remained unchanged at 6.1 percent in October, in line with expectations.
The number of people out of work increased 27,000 from the previous month after rising 19,000 in September. This was bigger than forecast of 17,000.
Federal Employment Agency chairwoman Andrea Nahles said the autumn recovery in the labor market was absent this year. Although unemployment and underemployoment declined in October, decreases were very small, Nahles noted.
Today's GDP data does not take away the fact that the economy remains stuck in stagnation, ING economist Carsten Brzeski said. "At least it is not falling into a severe recession," he added.
The government forecast the largest euro area economy to contract 0.2 percent this year. Last week, the International Monetary Fund projected the economy to stagnate this year and expand 0.8 percent in 2025.
Elsewhere, France and Spain showed better-than-expected growth, while Italy stagnated in the third quarter.
As the Paris Olympic and Paralympic Games boosted consumption, the French GDP growth doubled to 0.4 percent from 0.2 percent in the second quarter. This was also better than economists' forecast of 0.3 percent.
Underpinned by domestic demand, Spain's GDP grew 0.8 percent on a sequential basis, the same rate as seen in the second quarter. Growth was forecast to ease to 0.6 percent.
Italy's GDP remained flat in the third quarter, following a 0.2 percent rise in the second quarter. Economists had forecast the economy to log another 0.2 percent expansion.
Sensex, Nifty End Lower On Weak Global Cues
(RTTNews) - Indian shares ended Wednesday's session lower, with mixed earnings and caution ahead of next week's U.S. presidential election and Federal Reserve rate decision keeping investors anxious.
The benchmark SP/BSE Sensex dropped 426.85 points, or 0.53 percent, to 79,942.18, snapping a two-day winning streak on the back of weak cues from other Asian and European markets.
The broader NSE Nifty index closed at 24,340.85, down 126 points, or 0.51 percent, from its previous close.
Infosys, Trent, HDFC Life, Shriram Finance and Cipla fell 2-4 percent in the Nifty pack while Adani Enterprises rallied 3.7 percent after the company posted a nearly eight-fold rise in net profit in the September quarter.
Maruti Suzuki India, Britannia Industries, Tata Consumer Products and Hero MotoCorp climbed 2-3 percent.
Global cues were sluggish due to U.S. election jitters and persisting Middle East tensions.
Oil prices traded higher in European trade after two sessions of losses, while gold added to recent gains to reach new record highs.
The dollar rally paused after data showed U.S. job openings dropped to more than a 3-1/2-year low in September, in a possible sign of a slowing labor market that could bolster the case for more rate cuts by the Federal Reserve.
Swiss Market Ends Notably Lower
(RTTNews) - The Switzerland market ended notably lower on Wednesday after languishing in negative territory right through the day's session, as investors reacted to weak economic data, digested a slew of corporate earnings announcements, and looked ahead to some key U.S. economic data due later in the week.
The benchmark SMI ended with a loss of 132.87 points or 1.1% at 11,967.70. The index touched a low of 11,952.43 and a high of 12,093.33.
UBS Group shares dropped 4.53% despite the banking giant reporting a significant uptick in its third-quarter performance, driven by cost-cutting and robust loan income. The bank swung to a net profit of $1.43 billion in the third quarter from a year-ago loss of $711 million.
In the fourth quarter, however, UBS anticipates a mid-single digit decline in net interest income in its global wealth management business and a low single-digit fall in its personal and corporate banking division.
Swatch Group ended down 3.42%. Straumann Holdings, Sika and Schindler Ps lost 2.08%, 1.82% and 1.71%, respectively.
Logitech International, Partners Group, Sonova, Richemont, Alcon, Kuehne + Nagel, Julius Baer, Lonza Group, VAT Group and Roche Holding closed down 1 to 1.6%. Lindt Spruengli ended nearly 1% down.
Sandoz Group climbed 3.7%. SIG Group ended with a modest gain of about 0.3%.
Results of a survey by the KOF Swiss Economic Institute showed that a measure signaling future turning points in the Swiss economy weakened notably in October as the recovery of the economy is very uncertain.
The economic barometer dropped to 99.5 in October from a downwardly revised 104.5 in September. Meanwhile, economists had forecast a score of 105.1.
Although it is still within the medium-term average range, for the first time since January of this year it is no longer above the 100 mark, the KOF said.
China Shares Expected To Open In The Red
(RTTNews) - The China stock market has moved lower in consecutive trading days, slipping more than 55 points or 1.7 percent along the way. The Shanghai Composite now sits just above the 3,265-point plateau and it's looking at another soft start again on Thursday.
The global forecast for the Asian markets is negative on mixed corporate and economic news. The European and U.S. markets finished under water and the Asian bourses are expected to open in similar fashion.
The SCI finished modestly lower on Wednesday as losses from the financials and resource stocks were mitigated by support from the property sector.
For the day, the index shed 20.17 points or 0.61 percent to finish at 3,266.24 after trading between 3,244.81 and 3,291.68. The Shenzhen Composite Index perked 0.69 points or 0.04 percent to end at 1,973.62.
Among the actives, Industrial and Commercial Bank of China dropped 0.83 percent, while Bank of China retreated 1.43 percent, China Construction Bank skidded 1.12 percent, China Merchants Bank tumbled 1.87 percent, Agricultural Bank of China declined 1.67 percent, China Life Insurance tanked 2.31 percent, Jiangxi Copper plunged 3.18 percent, Aluminum Corp of China (Chalco) plummeted 7.90 percent, Yankuang Energy shed 0.58 percent, PetroChina slumped 1.10 percent, China Petroleum and Chemical (Sinopec) lost 0.64 percent, Huaneng Power surrendered 2.20 percent, China Shenhua Energy sank 1.32 percent, Gemdale surged 5.23 percent, Poly Developments added 0.47 percent and China Vanke advanced 0.99 percent.
The lead from Wall Street is soft as the major averages opened lower on Wednesday but then bounced higher for most of the day before a late slump saw them finish in the red.
The Dow dropped 91.51 points or 0.22 percent to finish at 42,141.54, while the NASDAQ tumbled 104.82 points or 0.56 percent to close at 18,607.93 and the SP 500 sank 19.25 points or 0.33 percent to end at 5,813.67.
The choppy trading came as investors reacted to a mixed batch of corporate earnings as Alphabet (GOOGL) and Snap (SNAP) rallied after good results, while Advanced Micro Devices (AMD) and Caterpillar (CAT) stumbled after disappointing.
On the U.S. economic front, payroll processor ADP said private sector employment in the U.S. shot up much more than anticipated in October, although a a separate report released by the Commerce Department showed U.S. economic growth unexpectedly slowed in the third quarter.
Oil prices moved higher on Wednesday after data showed an unexpected drop in U.S. crude inventories last week and on reports that OPEC may delay its planned output increase. West Texas Intermediate Crude oil futures for December closed up $1.40 or 2.1 percent at $68.61 a barrel.
Closer to home, China will see October results later this morning for the manufacturing, non-manufacturing and composite indexes from the National Bureau of Statistics; in September, their scores were 49.8, 50.0 and 50.4, respectively.
Bank Of Japan Interest Rate Decision Due On Thursday
(RTTNews) - The Bank of Japan will wrap up its monetary policy meeting on Thursday and then announce its decision on interest rates, setting the pace for a busy day in Asia-Pacific economic activity. The BoJ is expected to keep its benchmark lending rate unchanged at 0.25 percent.
Japan will also see September data for industrial production, retail sales, construction orders and housing starts. Industrial output is tipped to add 0.9 percent on month after slipping 3.3 percent in August. Sales are seen higher by an annual 2.1 percent, moderating from 2.8 percent in the previous month. In August, construction orders rose 8.7 percent on year and housing starts fell an annual 5.1 percent.
Australia will release September numbers for building approvals, private sector credit and retail sales, as well as Q3 data for import and export prices.
In August, building consents were down 6.1 percent on month and up 7.9 percent on year, while private sector credit rose 0.5 percent on month. Retail sales are tipped to add 0.3 percent on month, slowing from 0.7 percent in August. In Q2, export prices fell 5.9 percent on quarter and import prices rose 1.0 percent.
South Korea will provide September figures for retail sales and industrial production. Sales are expected to rise 0.5 percent on month after gaining 1.7 percent in August. Industrial output is tipped to add 1.2 percent on month and 0.2 percent on year after rising 4.1 percent on month and 3.8 percent on year in the previous month.
China will see October results for the manufacturing, non-manufacturing and composite indexes from the National Bureau of Statistics; in September, their scores were 49.8, 50.0 and 50.4, respectively.
Taiwan will provide preliminary Q3 data for gross domestic product, with forecasts suggesting an increase of 3.4 percent on year following the 5.06 percent gain in the previous three months.
Hong Kong will release preliminary Q3 GDP figures, with forecasts suggesting a flat quarterly reading and am annual increase of 3.1 percent. That follows the 0.4 percent quarterly increase and the 3.3 percent yearly gain in Q2.
Thailand will see September numbers for imports, exports, trade balance and current account. In August, imports were up 8.5 percent on year and exports rose an annual 11.4 percent for a trade surplus of $2.40 billion. The current account showed a surplus of $1.40 billion.
Finally, the markets in Malaysia and Singapore are closed on Thursday got Deepavali and will re-open on Friday.
Dollar Loses Ground Against Major Counterparts After GDP Data
(RTTNews) - The U.S. dollar shed ground on Wednesday after data showed an unexpected slowdown in the nation's GDP growth. Investors also digested strong private sector employment data and looked ahead to the crucial non-farm payroll data due later in the week.
Payroll processor ADP's report showed private sector employment in the U.S. shot up by much more than anticipated in the month of October. ADP said private sector employment surged by 233,000 jobs in October after jumping by an upwardly revised 159,000 jobs in September.
Economists had expected private sector employment to climb by 115,000 jobs compared to the addition of 143,000 jobs originally reported for the previous month.
However, a separate report released by the Commerce Department showed U.S. economic growth unexpectedly slowed in the third quarter.
The Commerce Department said gross domestic product shot up by 2.8% in the third quarter after surging by 3% in the second quarter. Economists had expected another 3% jump.
A report released by the National Association of Realtors (NAR) showed pending home sales in the U.S. spiked by much more than expected in the month of September. NAR said its pending home sales index soared by 7.4% to 75.8 in September after climbing by 0.6% to 70.6 in August. Economists had expected pending home sales to jump by 1.1%.
The dollar index, which dropped to 103.98, losing more than 0.3%, was last seen at 104.02.
Against the Euro, the dollar weakened to 1.0859 from 1.0820. Against Pound Sterling, the dollar firmed to 1.2963, gaining from 1.3015.
The dollar was roughly flat against the Japanese currency, at 153.35 yen a unit. Against the Aussie, the dollar weakened to 0.6575 from 0.6561.
The Swiss franc gained marginally against the dollar at 0.8665, while the Loonie strengthened to 1.3899 a unit of the U.S. currency, firming from 1.3915.
U.S. Dollar Retreats As GDP Growth Slows
(RTTNews) - The U.S. dollar pulled back against its major counterparts in the New York session on Wednesday, as a slowdown in GDP growth outweighed optimism about strong ADP data.
Data from the Commerce Department showed that U.S. economic growth unexpectedly slowed in the third quarter.
The Commerce Department said gross domestic product shot up by 2.8 percent in the third quarter after surging by 3.0 percent in the second quarter. Economists had expected another 3.0 percent jump.
However, a separate report released by payroll processor ADP showed private sector employment in the U.S. shot up much more than anticipated in October.
ADP said private sector employment surged by 233,000 jobs in October after jumping by an upwardly revised 159,000 jobs in September.
Economists had expected private sector employment to climb by 115,000 jobs compared to the addition of 143,000 jobs originally reported for the previous month.
The greenback fell to 9-day lows of 1.0866 against the euro and 1.3042 against the pound, from an early high of 1.0807 and a 6-day high of 1.2936, respectively. The currency is seen finding support around 1.10 against the euro and 1.32 against the pound.
The greenback was trading at 0.8661 against the franc and 153.07 against the yen, down from its early highs of 0.8694 and 153.48, respectively. The next possible support for the greenback is seen around 0.84 against the franc and 144.00 against the yen.
The greenback dropped to a 2-day low of 0.6595 against the aussie, reversing from an early 2-1/2-month high of 0.6536. The currency may challenge support around the 0.68 level.
The greenback eased to 1.3906 against the loonie, from an early 2-1/2-month high of 1.3940. If the currency falls further, it is likely to test support around the 1.36 region.
In contrast, the greenback held steady against the kiwi, after falling to a 5-day low of 0.6001 in the previous session. In the Asian session, the greenback climbed to a 2-1/2-month high of 0.5950 against the kiwi.
Continued Consolidation Called For KOSPI
(RTTNews) - The South Korea stock market on Wednesday ended the three-day winning streak in which it had advanced more than 35 points or 1.4 percent. The KOSPI now sits just above the 2,590-point plateau and it's tipped to open under pressure again on Thursday.
The global forecast for the Asian markets is negative on mixed corporate and economic news. The European and U.S. markets finished under water and the Asian bourses are expected to open in similar fashion.
The KOSPI finished modestly lower on Wednesday following losses from the financial shares and steel companies, while the technology and automobile stocks were mixed.
For the day, the index dropped 24.01 points or 0.92 percent to finish at 2,593.79 after trading between 2,586.88 and 2,613.47. Volume was 476.4 million shares worth 8.76 trillion won. There were 514 decliners and 350 gainers.
Among the actives, Shinhan Financial tanked 3.88 percent, while KB Financial stumbled 1.68 percent, Hana Financial surrendered 3.69 percent, Samsung Electronics sank 0.84 percent, Samsung SDI retreated 1.45 percent, LG Electronics perked 0.11 percent, SK Hynix rallied 2.47 percent, Naver soared 3.07 percent, LG Chem added 0.63 percent, Lotte Chemical rose 0.22 percent, SK Innovation declined 1.33 percent, POSCO tumbled 1.88 percent, SK Telecom shed 0.52 percent, KEPCO lost 0.43 percent, Hyundai Mobis gained 0.40 percent, Hyundai Motor slumped 1.56 percent and Kia Motors improved 0.43 percent.
The lead from Wall Street is soft as the major averages opened lower on Wednesday but then bounced higher for most of the day before a late slump saw them finish in the red.
The Dow dropped 91.51 points or 0.22 percent to finish at 42,141.54, while the NASDAQ tumbled 104.82 points or 0.56 percent to close at 18,607.93 and the SP 500 sank 19.25 points or 0.33 percent to end at 5,813.67.
The choppy trading came as investors reacted to a mixed batch of corporate earnings as Alphabet (GOOGL) and Snap (SNAP) rallied after good results, while Advanced Micro Devices (AMD) and Caterpillar (CAT) stumbled after disappointing.
On the U.S. economic front, payroll processor ADP said private sector employment in the U.S. shot up much more than anticipated in October, although a a separate report released by the Commerce Department showed U.S. economic growth unexpectedly slowed in the third quarter.
Oil prices moved higher on Wednesday after data showed an unexpected drop in U.S. crude inventories last week and on reports that OPEC may delay its planned output increase. West Texas Intermediate Crude oil futures for December closed up $1.40 or 2.1 percent at $68.61 a barrel.
Closer to home, South Korea will provide September figures for retail sales and industrial production later this morning. Sales are expected to rise 0.5 percent on month after gaining 1.7 percent in August. Industrial output is tipped to add 1.2 percent on month and 0.2 percent on year after rising 4.1 percent on month and 3.8 percent on year in the previous month.
Canadian Market Slightly Lower In Cautious Trade
(RTTNews) - Canadian stocks are turning in a mixed performance on Wednesday with investors largely reacting to earnings announcements, and U.S. economic data.
Materials stocks are among the notable losers, while consumer staples and utilities shares are finding good support.
The benchmark SP/TSX Composite Index is down 58.56 points or 0.25% at 24,503.99.
Secure Energy Services (SES.TO) is soaring 11.5% after reporting a net income of $94 million for the third-quarter this year, compared with $47 million in the year-ago quarter.
Capital Power Corporation (CPX.TO) is climbing 8.3% after the company reported net income of $178 million for the quarter ended September 30, 2024, compared with $272 million in the year-ago quarter.
Precision Drilling Corporation (PD.TO) is rising 8.5%. Hut 8 Corp (HUT.TO), Propel Holdings (PRL.TO) and goeasy (GSY.TO) are up 3.5 to 6%.
Metro Inc (MRU.TO), Loblaw Companies (L.TO), TerraVest Industries (TVK.TO), EQB Inc (EQB.TO), Kinaxis Inc (KXS.TO) and George Weston (WN.TO) are gaining 1 to 2%.
Ivanhoe Mines Ltd. (IVN.TO) reported a net profit of $108 million for the third-quarter of 2024, compared with $67 million in the second-quarter. The stock is down by about 3.7%.
Rogers Communications (RCI.A.TO), Toromont Industries (TIH.TO), Cameco Corporation (CCO.TO), Waste Connections (WCN.TO), Bank of Montreal (BMO.TO) and Morguard Corporation (MRC.TO) are down 1 to 2%.
Losing Streak May Continue For Taiwan Shares
(RTTNews) - The Taiwan stock market has moved lower in three straight sessions, stumbling more than 525 points or 2.5 percent along the way. The Taiwan Stock Exchange now rests just above the 22,820-point plateau and it may take further damage again on Thursday.
The global forecast for the Asian markets is negative on mixed corporate and economic news. The European and U.S. markets finished under water and the Asian bourses are expected to open in similar fashion.
The TSE finished modestly lower on Wednesday as losses from the technology stocks and plastics were offset by support from the financial sector.
For the day, the index sank 106.16 points or 0.46 percent to finish at 22,820.43 after trading between 22,801.45 and 23,116.33.
Among the actives, Cathay Financial added 0.58 percent, while Mega Financial collected 0.51 percent, First Financial perked 0.18 percent, E Sun Financial rose 0.37 percent, Taiwan Semiconductor Manufacturing Company dropped 0.96 percent, United Microelectronics Corporation shed 0.52 percent, Hon Hai Precision advanced 0.95 percent, Largan Precision lost 0.65 percent, Catcher Technology dipped 0.21 percent, MediaTek sank 0.77 percent, Delta Electronics fell 0.49 percent, Novatek Microelectronics was down 0.20 percent, Formosa Plastics declined 0.84 percent, Nan Ya Plastics slumped 0.36 percent, Asia Cement was up 0.11 percent and Fubon Financial and CTBC Financial were unchanged.
The lead from Wall Street is soft as the major averages opened lower on Wednesday but then bounced higher for most of the day before a late slump saw them finish in the red.
The Dow dropped 91.51 points or 0.22 percent to finish at 42,141.54, while the NASDAQ tumbled 104.82 points or 0.56 percent to close at 18,607.93 and the SP 500 sank 19.25 points or 0.33 percent to end at 5,813.67.
The choppy trading came as investors reacted to a mixed batch of corporate earnings as Alphabet (GOOGL) and Snap (SNAP) rallied after good results, while Advanced Micro Devices (AMD) and Caterpillar (CAT) stumbled after disappointing.
On the U.S. economic front, payroll processor ADP said private sector employment in the U.S. shot up much more than anticipated in October, although a a separate report released by the Commerce Department showed U.S. economic growth unexpectedly slowed in the third quarter.
Oil prices moved higher on Wednesday after data showed an unexpected drop in U.S. crude inventories last week and on reports that OPEC may delay its planned output increase. West Texas Intermediate Crude oil futures for December closed up $1.40 or 2.1 percent at $68.61 a barrel.
Closer to home, Taiwan will provide preliminary Q3 data for gross domestic product later today, with forecasts suggesting an increase of 3.4 percent on year following the 5.06 percent gain in the previous three months.
German Inflation Climbs More Than Expected Dampening Bigger Rate Cut Hopes
(RTTNews) - Consumer price inflation in Germany increased more than expected to its highest level in three months in October and the core figure moved closer to 3 percent, damping expectations for a bigger size interest rate cut from the European Central Bank.
The consumer price index rose 2.0 percent year-on-year following a 1.6 percent increase in September, preliminary estimates from the statistical office Destatis showed Wednesday. Economists had forecast the inflation rate to climb to 1.8 percent.
Inflation, based on the harmonized index of consumer prices or HICP, accelerated to 2.4 percent from 1.8 percent, which also surpassed the 2.1 percent economists had expected.
Core inflation, which excludes food and energy, increased to 2.9 percent from 2.7 percent.
Services inflation, one of the main concerns for policymakers because of its stubborn stickiness, rose to 4.0 percent from 3.8 percent.
"The decisive factor for the sharp rise in service prices is likely to be the noticeable increase in wage costs," Commerzbank economist Ralph Solveen said. "Since wages have risen significantly until recently, the only factor to slow prices is the weak economy, which will gradually push down the services inflation."
Food inflation shot up to 2.3 percent from 1.6 percent. Energy prices decreased 5.5 percent after a 7.6 percent slump in September. Goods prices edged up 0.4 percent following a 0.3 percent fall in the previous month.
The CPI rose 0.4 percent month-on-month after remaining flat in September. Economists were looking for a 0.2 percent increase.
The EU measure of inflation HICP also rose 0.4 percent from the previous month, when it decreased 0.1 percent in September. Economists had forecast a 0.2 percent gain.
The ECB has already cut interest rates thrice, the latest being the 25-basis points reduction earlier this month which was mainly due to increasing concerns over the sluggish growth in the euro area.
However, Eurostat flash estimates for the third quarter GDP released earlier on Wednesday showed that the single currency economy Eurozone grew a faster than expected 0.4 percent, underpinned by forecast-beating growth in Germany, France and Spain.
Several ECB policymakers have already signaled another reduction in December, when they will be equipped with the latest round of ECB Staff macroeconomic projections.
However, the recent economic indicators and survey data serve to damp hopes for a 50-basis point reduction from the central bank.
Further, economists expect inflationary pressures in Germany to increase further in the coming months as the base effects of energy prices fade.
The better-than-expected growth figures for Eurozone and the acceleration in inflation in Germany are set to make some ECB members start doubting both the October rate cut decision and the opening to even larger rate cuts, ING economist Carsten Brzeski said.
"Today's macro data releases in the eurozone, however, should encourage the ECB hawks to object to a 50bp rate cut in December. At least for now," Brzeski added.
TSX Ends Modestly Lower
(RTTNews) - The Canadian market ended weak on Wednesday, weighed down by losses in materials and technology sectors. Investors digested earnings updates from Canadian and U.S. companies, and awaited U.S. non-farm payroll data and Canadian GDP report, due later in the week.
The benchmark SP/TSX Composite Index ended down 54.76 points or 0.22% at 24,507.79 after scaling a low of 24,428.10 and a high of 24,571.26 intraday.
Materials stock Ivanhoe Mines (IVN.TO) ended down 3.85%. The company reported a net profit of $108 million for the third-quarter of 2024, compared with $67 million in the second-quarter. The stock is down by about 3.7%.
Fortuna Silver Mines (FVI.TO), Seabridge Gold (SEA.TO), First Majestic Silver Corp (AG.TO), Pan American Silver Corp (PAAS.TO) and Hudbay Minerals (HBM.TO) closed down 2.5 to 4%.
Technology stocks Bitfarms (BITF.TO) and BlackBerry (BB.TO) lost 4.49% and 3.56%, respectively. CGI Group (GIB.A.TO), Converge Technology Solutions (CTS.TO) and Sangoma Technologies (STC.TO) closed down 1.25 to 1.6%.
Secure Energy Services (SES.TO) soared nearly 10% after reporting a net income of $94 million for the third-quarter this year, compared with $47 million in the year-ago quarter.
Capital Power Corporation (CPX.TO) climbed 7.8% after the company reported net income of $178 million for the quarter ended September 30, 2024, compared with $272 million in the year-ago quarter.
China Manufacturing Activity Expands For First Time In 6 Months
(RTTNews) - China's manufacturing activity expanded for the first time in six months in October, underpinned by strong domestic demand, official survey data revealed Thursday.
The official manufacturing Purchasing Managers' Index rose to 50.1 in October from 49.8 in September, survey data from the National Bureau of Statistics showed. The score was seen unchanged at 49.8.
A reading above the threshold 50.0 indicates expansion, while a score below 50.0 signals contraction. The Caixin General manufacturing PMI survey data is due on November 1.
The non-manufacturing PMI, which tracks both the service and construction sectors, posted 50.2, up from 50.0 in the previous month but below forecast of 50.4.
The overall composite PMI that combines services and manufacturing, advanced to 50.8 from 50.4 in September.
Although the PMIs have overstated the weakness in China's economy over the past year, they still provide some sense of the direction of travel, Capital Economics' economist Julian Evans-Pritchard said.
The economist noted that the uptick in the PMIs for September was mirrored by an improvement in the wider data. So it is encouraging to see the composite index rise further in October, he added.
European Shares Seen Lower With Focus On Earnings And US Election
(RTTNews) - European stocks may drift lower at open on Thursday as investors absorb another batch of mixed earnings results from megacap technology companies and await key U.S. inflation data for directional cues.
Microsoft delivered solid quarterly results but forecast slower quarterly cloud revenue growth. Facebook owner Meta saw net income and revenues top expectations.
Apple, Amazon, MasterCard, Uber, Merck and Intel are slated to report later in the day.
U.S. reports on weekly jobless claims and personal income and spending, which includes the Federal Reserve's preferred inflation readings, due out later in the day along with Friday's October payrolls report, may offer further clues on what to expect from the Federal Reserve meeting on Nov. 7.
Meanwhile, with election day in the United States less than a week away, polls predict a narrow contest between Democratic nominee Vice President Kamala Harris and Republican rival former President Donald Trump.
Closer home, Eurozone flash inflation and unemployment figures as well as German retail sales data may garner investor attention later in the day.
Asian markets fell broadly as signs of a resilient U.S. economy prompted traders to trim bets on policy easing.
Chinese and Hong Kong markets clung to modest gains after official manufacturing PMI beat forecasts to hit a six-month high in October.
The yen strengthened as the Bank of Japan maintained ultra-low interest rates in the wake of a fragile domestic recovery and rising global uncertainties.
Gold prices dipped from record highs reached the precious day but were on track for their best month in seven on safe-haven demand.
Oil prices rose, extending the previous day's rally driven by optimism over U.S. fuel demand following an unexpected drop in crude and gasoline inventories.
U.S. stocks ended firmly in the red overnight as investors reacted to mixed earnings results and economic reports.
Private-job creation jumped to its highest level in more than a year in October, while the U.S. economy grew at a slightly slower annualized rate of 2.8 percent in the third quarter ahead of elections, separate set of data showed.
The tech-heavy Nasdaq Composite shed 0.6 percent, the SP 500 dipped 0.3 percent and the Dow eased 0.2 percent.
European stocks closed lower on Wednesday as investors reacted to a fresh batch of corporate earnings, regional growth data and the U.K. Labour Party's first budget in nearly 15 years.
The pan European STOXX 600 declined 1.3 percent. The German DAX and France's CAC 40 both fell by 1.1 percent while the U.K.'s FTSE 100 dropped 0.7 percent.
Asian Shares Decline Following BoJ Decision
(RTTNews) - Asian stocks ended broadly lower on Thursday as investors reacted to mixed earnings from U.S. technology companies and signals from the Bank of Japan that further rate rises were still on the horizon.
Chinese markets bucked the weak regional trend ahead of a highly anticipated top legislative bond meeting scheduled in Beijing on Nov. 4-8, with investors awaiting details of stimulus measures.
The yen recovered from near a three-month low against the dollar as the Bank of Japan kept rates steady and warned of "high uncertainties" following the ruling party's worst election result in 15 years.
Gold prices climbed to a record high before retreating as investors awaited U.S. non-farm payrolls figures, inflation data and next week's presidential election for insight into the Federal Reserve policy.
Oil extended gains from the previous session on optimism over U.S. fuel demand following an unexpected drop in crude inventories.
China's Shanghai Composite index rose 0.42 percent to 3,279.82 as official data showed China's manufacturing sector returned to expansion in October after five consecutive months of contraction.
A survey on services also showed some pick-up in activity. Hong Kong's Hang Seng index ended 0.31 percent lower at 20,317.33 after a choppy session.
Japanese markets closed lower due to political uncertainty and concerns about abrupt policy shifts. Also, reports on retail sales and industrial production released today offered mixed signals about the economy.
The Nikkei average dropped half a percent to 39,081.25 while the broader Topix index settled 0.30 percent lower at 2,695.51.
Seoul stocks fell sharply after Facebook owner Meta Platforms and Microsoft both warned of accelerating costs for artificial intelligence.
The Kospi average ended down 1.45 percent at 2,556.15, dragged down by financials and technology stocks.
Data showed earlier in the day that South Korea's industrial output fell from a month earlier in September on dwindling production in the semiconductor and other manufacturing sectors.
Samsung Electronics finished marginally higher after reporting a higher profit for the third quarter compared to last year.
Australian markets ended modestly lower due to concerns about persistent core inflation in the country and the rate outlook.
The benchmark SP/ASX 200 slid 0.25 percent to 8,160 while the broader All Ordinaries index closed 0.21 percent lower at 8,422.10.
Mineral Resources jumped 9.2 percent after an announcement that it has reached an oil and gas exploration deal with Gina Rinehart's Hancock Prospecting worth up to 1.1 billion Australian dollars (US$720 million).
Across the Tasman, New Zealand's benchmark SP/NZX-50 index dipped 0.44 percent to 12,638.90 ahead of earnings updates from Apple and Amazon later in the day. Taiwanese markets were shuttered due to a typhoon.
U.S. stocks ended firmly in the red overnight as investors reacted to mixed earnings results and economic reports.
Private-job creation jumped to its highest level in more than a year in October, while the U.S. economy grew at a slightly slower annualized rate of 2.8 percent in the third quarter ahead of elections, separate set of data showed.
The tech-heavy Nasdaq Composite shed 0.6 percent, the SP 500 dipped 0.3 percent and the Dow eased 0.2 percent.
European Economic News Preview: Eurozone Inflation, Unemployment Data Due
(RTTNews) - Inflation and unemployment from the euro area and retail sales from Germany are the top economic news due on Thursday.
At 3.00 am ET, Destatis is scheduled to issue Germany's retail sales and import prices for September. Economists forecast retail sales to fall 0.7 percent on month in September. Import prices are expected to drop 0.4 percent on month, the same rate of decline as seen in August.
At 3.45 am ET, France's flash inflation data is due. Consumer price inflation is expected to rise to 1.9 percent in October from 1.1 percent in September.
At 5.00 am ET, Italy's statistical office ISTAT releases unemployment data for September. The jobless rate is seen unchanged at 6.2 percent.
At 6.00 am ET, Eurostat is scheduled to issue euro area flash inflation and unemployment data. Inflation is expected to rise to 1.9 percent in October from 1.7 percent in September. The jobless rate is seen unchanged at 6.4 percent.
In the meantime, preliminary inflation figures are due from Italy.
South Korea Industrial Production Slips 0.2% In September
(RTTNews) - Industrial production in South Korea was down a seasonally adjusted 0.2 percent on month in September, Statistics Korea said on Thursday.
That was well shy of forecasts for an increase of 1.2 percent following the 4.4 percent gain in August.
On a yearly basis, industrial production sank 1.3 percent - again shy of expectations for a gain of 0.2 percent after adding 3.8 percent in the previous month.
The stats bureau also said that retail sales slumped 0.4 percent on month after rising 1.7 percent a month earlier.
Yen Rises Against Majors
(RTTNews) - The Japanese yen strengthened against other major currencies in the Asian session on Thursday.
The yen rose to a 2-day high of 165.07 against the euro, a 6-day high of 152.06 against the U.S. dollar and a 3-day high of 175.86 against the Swiss franc, from an early 3-month low of 166.09, a 2-day low of 153.59 and nearly a 3-1/2-month low of 177.29, respectively.
The yen advanced to a 6-day high of 197.22 against the pound, from an early low of 198.92.
Against Australia, the New Zealand and the Canadian dollars, the yen climbed to nearly a 2-week high of 99.97, a 6-day high of 90.88 and an 8-day high of 109.30 from early lows of 100.92, 91.82 and 110.39, respectively.
If the yen extends its uptrend, it is likely to find resistance around 158.00 against the euro, 148.00 against the greenback, 170.00 against the franc, 195.00 against the pound, 98.00 against the aussie, 89.00 against the kiwi and 107.00 against the loonie.
Bank Of Japan Keeps Key Rate Unchanged
(RTTNews) - The Bank of Japan left its key interest rate unchanged as widely expected on Thursday and retained a cautious approach as political instability and looming US presidential election added concerns about economic outlook.
In a unanimous vote, the Policy Board decided to maintain the uncollateralized overnight call rate to remain at around 0.25 percent. This was the highest since late 2008.
The BoJ had ended its negative interest rate policy in March and last lifted the benchmark rate in July to the current level. So far the bank has tightened the policy twice this year.
The bank said it needs to pay close attention to overseas economies, especially the US, and developments in global financial markets.
While US election due next week added uncertainty surrounding overseas economies, the ruling Liberal Democratic Party's election loss added domestic uncertainty.
Capital Economics' economist Marcel Thieliant said he expects a new government to be formed and a supplementary budget to be passed by the time of the Bank's next meeting in December.
With inflation excluding fresh food and energy picking up again in recent months and set to hover above the 2 percent target over the next few months, there is a strong case for another rate hike as soon as December, the economist added. However, further tightening is unlikely in 2025, he said.
In the latest, Outlook for Economic Activity and Prices, the bank said the economy is likely to keep growing at a pace above its potential growth rate. The bank upgraded its economic growth for the fiscal 2025 and retained the projections for the fiscal 2024 and 2026.
The economy is forecast to grow 0.6 percent in the fiscal 2024. Meanwhile, growth outlook for the fiscal 2025 was raised marginally to 1.1 percent from 1.0 percent and that for the fiscal 2026 was retained at 1.0 percent.
The projected inflation for the fiscal 2025 was somewhat lower due to factors such as the recent decline in crude oil and other resource prices. Inflation was seen at 1.9 percent, down from 2.1 percent estimated in July.
Inflation forecast for 2024 was maintained at 2.5 percent and that for 2026 at 1.9 percent.
Japan Retail Sales Gain 0.5% On Year In September
(RTTNews) - The value of retail sales in Japan was up 0.5 percent on year in September, the Ministry of Economy, Trade and Industry said on Thursday - coming in at 13.489 trillion yen.
That missed forecasts for an increase of 2.1 percent and was down from 3.1 percent in the previous month.
On a monthly basis, sales slipped 2.3 percent after rising 1.0 percent in August.
For the third quarter of 2024, sales rose 1.1 percent on quarter and 2.1 percent on year to 41.610 trillion yen.
Japan Industrial Output Climbs 1.4% In September
(RTTNews) - Industrial production in Japan was up a seasonally adjusted 1.4 percent on month in September, the Ministry of Economy, Trade and Industry said on Thursday.
That beat forecasts for an increase of 0.9 percent following the 3.3 percent contraction in August.
On a yearly basis, industrial production was down 2.8 percent.
Upon the release of the data, the METI maintained its assessment of industrial production, saying that it continues to fluctuate indecisively.
Shipments were up 2.3 percent on month and down 4.3 percent on year, while inventories rose 0.1 percent on month and fell 1.3 percent on year. The inventory ratio was down 3.8 percent on month and up 3.0 percent on year.
According to the METI's forecast of industrial production, output is expected to jump 8.3 percent on month in October and then fall 3.7 percent in November.
