Toronto's main stock index looked set to open higher on Wednesday, after European Central Bank (ECB) Governing Council member Ewald Nowotny said there are arguments for giving Europe's permanent rescue fund a banking licence.
The S&P/TSX Composite index tumbled 78.59 points to finish Tuesday at 11,466.95. This morning, Canada stock futures traded up 0.6%.
The Canadian dollar gained 0.44 cents Wednesday morning to 98.27 cents U.S.
Among Canadian stocks to watch this morning, Canadian Pacific Railway, fresh from a proxy battle that ousted its chief executive officer and chairman, reported a 20% drop in quarterly earnings on Wednesday due to the impact of a strike by its engineers in May and management transition costs.
Teck Resources Inc, Canada's largest diversified miner, reported a drop in its second-quarter net profit of nearly 65%, largely due to lower coal and metal prices.
Encana Corp reported a second-quarter net loss as it wrote down assets because of declines in natural gas prices.
Precision Drilling Corp, Canada's largest oil and gas drilling contractor, reported an 11 percent rise in quarterly profit on higher rates but cut its adjusted capital expenditure plan for the year citing lower-than-expected industry activity.
ON BAYSTREET
The TSX Venture Exchange fell 7.69 points to 1,166.47. The Nasdaq Canada index let go of 2.35 points to 329.25.
ON WALLSTREET
U.S. stocks were headed for a choppy open Wednesday. Apple was poised to be a big drag on tech stocks, while the broader market could get a boost from Caterpillar's strong results.
And Europe continues to be a worry, with Spain's borrowing costs skyrocketing, weakening business confidence in Germany, and Greece's creditors taking stock of that nation's progress.
Futures for the Dow Jones shot up 131 points, or 1.1%, to 12,655, about 30 minutes before the opening bell. Futures for the S&P 500 gained 8.9 points, or 0.7%, to 1,338.40, and for the Nasdaq, futures fell two points, or 0.1%, to 2,546.50
Investors also continued to parse through quarterly earnings.
Ford's second-quarter profit dropped 57% to $1 billion U.S., hurt by a loss in the company's European operations. But the automaker's earnings and sales topped Wall Street forecasts, sending shares up in pre-market trading.
PepsiCo reported better-than-expected earnings before the opening bell. But, like many global companies, its revenue was hurt by unfavorable currency exchange rates.
Meanwhile, global markets garnered some support from comments by Nowotny, who said it may be justified to take steps that would boost the firepower of the euro-zone's new bailout fund.
Nowotny also said that there are some arguments in favour of granting the European Stability Mechanism (ESM) a banking license that would allow it to borrow unlimited money from the ECB.
European stocks were higher in morning trading. Britain's FTSE 100 ticked up 0.2%, the DAX in Germany added 0.5% and France's CAC 40 rose 0.6%.
Asian markets ended in the red. The Shanghai Composite lost 0.5%, the Hang Seng in Hong Kong slipped 0.1% and Japan's Nikkei dropped 1.4%.
Oil for September delivery rose 20 cents to $88.70 U.S. a barrel.
Gold futures for August delivery rose $15.60 to $1,591.80 U.S. an ounce.
