Flat Start for Stocks

·3 min read

Futures for Canada's main stock index struggled for direction on Monday ahead of a policy announcement from the Bank of Canada this week, with investors also keeping watch on miners and energy stocks in the face of rising commodity prices.

The TSX Composite fought its way to a gain Friday of 3.76 points to finish and the week at 21,216.15. Over the last five sessions, the index was ahead 288 points, or 1.38%.

The Canadian dollar gathered 0.0 cents to 80.87 cents U.S.

December futures inched up 0.02% Monday.

The central bank is facing increasing pressure to hike interest rates ahead of schedule when it meets on Wednesday, amid hot inflation and a recovering job market in Canada.

Burger King and Tim Hortons are struggling with a staffing crunch and the Delta variant keeping coffee-loving office workers at home, causing parent Restaurant Brands International to miss estimates for quarterly revenue on
Monday.

An investor group led by Canadian real estate company Canderel has agreed to take Cominar REIT private in a $2.14-billion deal, as it looks to expand its presence in Montreal, Quebec City and Ottawa.

Demand has jumped for relatively cheap Canadian natural gas, driving exports to the United States to three-year highs and prompting producers in Canada to boost capital spending and drilling activity.

ON BAYSTREET

The TSX Venture Exchange strengthened 3.45 points to 948.84, for a gain on the week of 11 points, or 1.19%.

ON WALLSTREET

U.S. stock futures were slightly in the green Monday after the Dow Jones Industrial Average closed its third positive week in a row at a record, driven by better-than-expected earnings reports.

Futures for the Dow Jones Industrials gained 25 points, or 0.1%, to 35,582.

Futures for the S&P 500 picked up 6.5 points, or 0.1%, to 4,543

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Futures for the NASDAQ Composite Index took on 38.5 points, or 0.3%, to 15,379.75.

Major averages have all registered solid gains for October. The Dow and the S&P 500 are both up more than 5%, while the NASDAQ Composite has climbed 4.4% month to date.

Leading the October rally in the broader market has been the energy sector, which is up 11% this month. Industrials, real estate, materials and financials have all popped at least 7% over the same period.

Some of the biggest technology companies are slated to report earnings this week, including Facebook, Alphabet, Microsoft, Amazon and Apple. A third of the Dow companies also is set to release quarterly results this week, including Caterpillar, Coca-Cola, Boeing and McDonald’s.

Microsoft and Amazon were higher in pre-market trading ahead of their results this week.

Shares of Tesla, which reported record revenue and profits last week, gained 4% in pre-market trading Monday after Morgan Stanley hiked its price target on the shares to $1,200 from $900.

Of the 117 companies in the S&P 500 that have reported earnings to date, 84% posted numbers that beat expectations. S&P 500 companies are expected to grow profit by about 35% in the third quarter.

Overseas, in Japan, the Nikkei 225 dropped 0.7% Monday, while in Hong Kong, the Hang Seng eked up five points.

Oil prices moved ahead $1.24 to $85.00 U.S. a barrel.

Gold prices jumped $6.70 to $1,803 U.S. an ounce.


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