October 16th, 2015

Daily Market Commentary

 

ECONOMIC NEWS

  • Foreign portfolio investment in Canadian securities in August was $3 billion, above estimates of $2.2 billion.
  • Capacity utilization in the U.S. was 77.5%, slightly above estimates.
  • The Consumer Price Index in the Eurozone was up 0.2% and down 0.1% in month-over-month and year-over-year terms, respectively. Both were in line with estimates.

Commodities:

  • Oil rose for the first time in five days amid a global equity rally and as OPEC prepared to hold technical discussions with Russia and other non-member producers next week.
  • Gold fell after hitting its highest level in more than three months, although prices are still on course for a second weekly advance amid fading expectations that the U.S. will raise interest rates this year.
  • The oil-market revival is hitting its latest hurdle: refinery repairs in the Midwest. Plants in the region processed the least crude in seven years last week amid a heavy slate of maintenance, forcing companies to store more oil in Cushing, Oklahoma, and sending prices to a 10-day low.

Canada:

  • Canadians vote in a federal election Monday that will probably put an end to the decade-long reign of Prime Minister Stephen Harper’s Conservatives, and may be followed by uncertain negotiations to secure a more left-leaning government. The opposition Liberals under Justin Trudeau are poised to secure the most seats in Parliament, polls suggest, while falling short of the 170 required for a majority.
  • The president of Pacific NorthWest LNG says the energy consortium is poised to start construction next year, undaunted by a native group’s legal challenge of the project’s proposed British Columbia site for exporting liquefied natural gas.(Globe)
  • TD Asset Management Inc., which presciently moved into the safety of bonds ahead of the recent stock market tumble, is making another contrarian bet: high-yield bonds.

United States:

  • U.S. stock-index futures were little changed as investors weighed earnings reports, while awaiting confidence and production data for indications of the health of the economy.
  • Honeywell International Inc. posted third-quarter earnings that beat analysts’ estimates as sales of safety and security products rose and the company slashed costs to make up for weaker oil industry demand.
  • U.S. banks are gorging on Treasuries in the latest sign investors expect the Federal Reserve to postpone raising interest rates.

 

International:

  • Positive sentiment in Europe’s equity market dominated for a second day on confidence that central-bank stimulus will continue to support the global economy.
  • Nestle SA said it will fall short of its long-term growth target for a third consecutive year amid weakness in China, highlighting the volatile conditions in emerging markets that continue to weigh on European consumer-product companies and retailers alike.
  • BMW AG’s car-assembly plant in South Africa is doing its bit to help the German carmaker edge toward a global target to supply all its production with renewable energy: It’s getting some of its power from cow manure.
  • Uber Technologies Inc. got a boost from a London judge who said smartphones used by its drivers weren’t the same as taxi meters and didn’t require a license from the city’s transport authority.
  • Asian stocks rose, with the regional benchmark index heading for an eight-week high, as financial companies led gains.

*All information is taken from Bloomberg, unless otherwise noted.