February 16, 2017

Daily Market Commentary




Economic News:

  • Initial jobless claims in the US beat estimates, while continuing jobless claims were slightly worse than estimates.
  • Foreign Direct Investment year-to-date in China was reportedly down 9.2% in year-over-year terms.
  • French Unemployment was quoted at 10% in the fourth quarter.



  • The trade pact between Canada and the European Union approved this week could be one of the world’s last multilateral trade deals unless policy makers share the benefits more widely, Canadian Prime Minister Justin Trudeau told European lawmakers. Trudeau addressed the European Parliament in Strasbourg, France, on Thursday after both it and Canada’s House of Commons approved the trade agreement, known as CETA, this week.
  • Bombardier Inc. reported a wider-than-expected fourth-quarter loss as revenue declined in the company’s two biggest units: business jets and trains. Canada’s largest aerospace company posted an adjusted loss of 7 cents a share, after breaking even a year earlier.
  • Barrick Gold Corp. remains committed to growing free cash flow above all else, even as some of its peers focus on boosting production. Already the world’s largest miner of the metal, Barrick plans to increase annual output modestly this year to between 5.6 million and 5.9 million ounces of gold, from 5.52 million ounces in 2016.
  • A proposed $27 billion liquefied natural gas project in western Canada got a boost after British Columbia offered at least C$145 million ($111 million) in funding for native groups. The province and two First Nation groups reached agreements that will allow Petroliam Nasional Bhd. and its partners to work “on a common goal of realizing the project,”.


United States:

  • U.S. stock-index futures were slightly down following Wall Street’s seven-day winning run, while the technology sector was in focus after Cisco Systems Inc. topped estimates for second-quarter revenue and profit.
  • The six largest U.S. banks could see annual profit jump by an average of 14 percent if President Donald Trump delivers on his promise to cut corporate taxes. The lenders, which stand to benefit more than other industries because they typically have fewer deductions, could save a combined $12 billion a year.
  • With the final permit in hand to finish its controversial Dakota Access oil pipeline, Energy Transfer Partners LP was able to close the sale of a $2 billion stake in assets to a joint venture Enbridge Inc. and Marathon Petroleum Corp. Energy Transfer said Wednesday that it had completed the deal, giving the venture a minority stake in a pipeline system that includes Dakota Access.
  • Snap Inc. set the valuation on its initial public offering at between $19.5 billion and $22.2 billion in what could be the third-biggest technology offering of the past decade, people familiar with the matter said.
  • Verizon Communications Inc. used to warn that unlimited data would drain profits. Now it’s seeing the upside. This week’s decision by the largest U.S. wireless carrier to begin offering unlimited data services was in part a capitulation to competitors who have stolen away subscribers with similar offerings. But the move to unlimited may also help New York-based Verizon by putting further pressure on new rivals that are planning to enter the market this year.
  • European stocks fell, snapping a seven-day rally, as investors assessed disappointing outlooks from Nestle SA and Cobham Plc. The equity benchmark yesterday extended a one-year high, buoyed by expectations of higher borrowing costs in the U.S. as well as higher inflation globally.
  • Vale SA posted record iron-ore output that beat analysts’ estimates as the top producer of the steel-making ingredient feeds growing Chinese demand. Copper and nickel production were also at all-time highs. The Rio de Janeiro-based company produced 92.4 million metric tons of iron ore in the fourth quarter, including third-party purchases, up from 88.4 million a year earlier.
  • Asian equities rose, led by gains in Hong Kong, as investors look to Asia’s best-performing developed market this year amid earnings optimism and signs of an improving economy. Chinese banks listed in Hong Kong extended their gains after data showing record levels of new credit this week boosted confidence in the Chinese economy.






*All sources from Bloomberg unless otherwise specified