Bay Street May See Lower Opening On Weak Global Cues
(RTTNews.com) - Canadian shares may open lower on Monday, tracking weakness in global markets amid renewed worries about growth after data showed an unexpected contraction in China's trade in the month of December.
Lower crude oil prices and worries about U.S. government shutdown and Brexit may also weigh on stocks.
With the reporting season kicking off, activity may remain largely stock specific.
Major U.S. banks are scheduled to report their quarterly earnings this week. Citigroup today reported fourth quarter earnings of $1.61 per share on revenue of $17.12 billion, as compared to earnings per share of $1.28 on revenue of $17.26 billion in the year-ago quarter. In the previous quarter, the bank reported earnings of $1.73 per share, on revenue of $18.39 billion.
On Friday, the benchmark S&P/TSX Composite Index ended up 35.69 points, or 0.24%, at 14,939.18 after scaling a low of 14,855.15 and a high of 14,956.20 intraday.
In company news, Newmont Mining Corp. is set to buy Goldcorp Inc. (G.TO), in a deal valued at $10 billion that will create the world's largest gold miner. The companies announced today that Newmont will exchange 0.328 of a share and two cents for each of Goldcorp's outstanding common shares. The combined company would be called Newmont Goldcorp and be owned 65% by current Newmont shareholders and 35% by Goldcorp shareholders.
Aurora Cannabis Inc. (ACB.TO) announced today that the company has entered into a letter of intent to acquire all the issued and outstanding shares of privately held Whistler Medical Marijuana Corporation, in an all-share transaction valued at up to approximately $175 million.
Asian stocks ended lower on Monday as a shock contraction in Chinese exports and concerns surrounding the ongoing U.S. government shutdown and the vote on Brexit this week kept investors on the sidelines.
Investors were also wary of making significant moved ahead of the U.S. earnings season.
China's exports and imports in December declined at the worst rates in two years, adding to evidence of a rapid slowdown in the economy amid the trade war with the US and weakening global activity.
Exports dropped 4.4% year-on-year in December, figures from the General Administration of Customs showed on Monday. That was in contrast to the 3% gain economists had predicted. Imports decreased 7.6% from a year ago, defying expectations for a 5% rise.
Both exports and imports outcome was the worst since 2016. In December, the trade surplus was $57.1 billion.
European markets were drifting lower, weighed by weak Chinese trade data and on concerns surrounding the ongoing U.S. government shutdown and Brexit.
In economic news, eurozone's industrial production decreased at a faster-than-expected pace in November, preliminary data from the statistical office Eurostat showed on Monday. Industrial production decreased a seasonally adjusted 1.7% from October, when it edged up 0.1%, revised from 0.2%. Economists had expected a 1.5% slump.
On a year-on-year basis, industrial production fell a calendar adjusted 3.3% in November after a 1.2% increase. Economists had predicted a 2.1% slump.
In commodities, crude oil futures for February were declining $0.47, or 0.91%, at $51.12 a barrel, on renewed worries about energy demand after data showed a surprise contraction in Chinese trade.
Natural gas futures for February were rising $0.275, or 8.87%, at $3.374 per million btu.
Gold futures for February were rising $5.45, or 0.42%, at $1,294.95 an ounce.
Silver futures for March were down $0.022, or 0.14%, at $15.634 an ounce, while Copper futures for March were lower by $0.034, or 1.28%, at $2.628 per pound.
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