Heavy week for North American earnings, says analyst

There will be lots of activity to watch this week, on both sides of the border, says Prab Sagoo, associate director at Nasdaq Advisory Services, in his latest weekly highlight.

On Tuesday, Canada’s November GDP will be released. Sagoo notes, “Current estimates expect +0.3% with [fourth-quarter] GDP expected to show some strength overall.”

But, all eyes will be on the U.S. Federal Reserve’s Wednesday rate announcement, he says. As of 10:15am EST on January 30^th, CME’s FedWatch Tool indicated there’s a 96% probability that the Fed will stand down this time around and that another hike is most probable in June 2017.

Further, Friday will see the release of U.S. monthly nonfarm payrolls and it will be “a heavy week of earnings” in Canada and the U.S. Says Sagoo, “[There will be] Canadian earnings announcements from CGI, Saputo, BCE and Brookfield Renewable. In the U.S., 150 S&P500 companies will release earnings this week including Apple, Facebook and Amazon.”

Last week’s market activity

• The TSX finished the week flat and was unable to its recent strong run, though the index remains near all-time highs.
• Energy stocks weighed heavily this past week, dropping 2% as concerns mounted that supply is starting to grow again. Gold stocks also lost ground but Materials finished just in the green. Tech outperformance was aided by strong Telco gains following Roger’s earnings.
• Small caps outperformed, though YTD we’re seeing an even push from large and small caps highlighted by the fact that about two thirds of the index is above both their 50- and 200-day moving averages.
• The loonie strengthened versus the greenback, while Copper and Silver showed gains on the metals front. Government yields were mostly flat.

Staff

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