TSX heads for flat open amid solid bank earnings

BMO posted net income of $970 million or $1.42 per share, up 37% from a year ago. On an adjusted basis, the bank’s earnings were $1.49 per share, beating analyst expectations by 10 cents. BMO also increased its dividend by two cents to 72 cents a share.

Scotiabank’s quarterly profits grew by 57% to $2.05 billion or $1.69 a share, three cents higher than expectations. The bank also said it is raising its quarterly dividend by two cents to 57 cents per share.

The Scotiabank results were helped by an after-tax gain of $614 million from the sale of its headquarters in Toronto’s financial district.

The Canadian dollar rose 0.19 of a cent 101.12 cents US.

New York futures were listless ahead of key housing and consumer data as the Dow Jones industrial futures were off one point to 13,106, the Nasdaq futures added 0.8 of a point to 2,783.5 and the S&P 500 futures dipped 0.3 of a point to 1,408.

Traders looked for the latest reading of the Case Schiller house price index. The U.S. housing sector has been showing signs of improvement lately, with positive reports on home sales and rising building permits.

The Conference Board will release its latest reading on consumer confidence. Economists expect the index to show a slight improvement from July’s reading of 65.9.

In the meantime, traders looked ahead to a speech Friday by U.S. Federal Reserve chairman Ben Bernanke at the central bank’s annual retreat at Jackson Hole, Wyo. Markets have registered solid gains in August, in large measure from expectations that global central banks will step in with further stimulus measures to maintain the momentum of the economic revival and preserve the eurozone monetary union.

But some analysts caution Bernanke is unlikely to tip his hand ahead of a slew of key economic data next week, particularly the non-farm payrolls report for August. This past month has seen a string of positive economic data, starting with better than expected job creation in July, rising retail sales and consumer confidence and positive housing reports.

Meanwhile, European Central Bank head Mario Draghi has called off his trip to the Fed conference, due to a heavy workload as top ECB officials shape their plans to intervene in bond markets and lower borrowing costs for indebted governments.

The ECB plan remains subject to debate ahead of the bank’s monthly meeting on Sept. 6, when it is expected to announce more details. Germany’s central bank is still opposed to the plan to buy government bonds.

Oil prices rose ahead of the consumer confidence data as threats to production in the Gulf of Mexico from tropical storm Isaac appeared to lessen. Forecasts for Isaac have been toned down, easing concerns that the storm could damage key oil and gas operations along the U.S. Gulf Coast.

Weather forecasters now say the storm will grow to a Category 1 hurricane instead of a stronger Category 2.

The October crude contract on the New York Mercantile Exchange rose 76 cents to US$96.23 a barrel.

Other commodities headed lower with September copper off a penny at US$3.47 a pound while December gold gained $10.30 to US$1,665.30 an ounce.

Meanwhile, Spain saw some good news from a bond auction. Spain’s Treasury sold nearly €4 billion in short-term debt auctions that saw investors accepting much lower interest rates, reflecting easing concern that the country will need a full-blown bailout.

The Spanish Treasury sold €1.67 billion in three-month bills at an average interest rate of 0.95%, down from 2.43% in the last such auction July 24. And it sold €1.93 billion in six-month bills on a yield of 2.03%, down from 3.69%.

European bourses were lower with London’s FTSE 100 down 0.2%, Frankfurt’s DAX declined 0.5% and the Paris CAC 40 stepped back 0.7%.

Earlier in Asia, the Tokyo Stock Exchange’s benchmark Nikkei lost 0.6%, South Korea’s Kospi index was down nearly 0.1% while the Hang Seng index inched up marginally.

Key indexes dipped in Singapore, Indonesia and Taiwan, while rising in New Zealand, mainland China and Australia.

Another factor pushing up prices was an intense fire at the Amuay refinery in western Venezuela. The fire has been burning since a huge explosion at the refinery on Saturday caused a suspension of operations there.