The Toronto stock market looked set for a lower open Friday amid soft commodity prices and an earnings disappointment from U.S. banking giant J.P. Morgan Chase.
The Canadian dollar was little changed, down 0.02 of a cent to 98.18 cents US.
U.S. futures were weak after J.P. Morgan Chase reported that its income fell 23% in the fourth quarter of 2011 after the bank set aside a large sum for litigation reserves and its investment banking income declined. The largest bank in the U.S. said Friday it earned US$3.7 billion, or 90 cents per share, three cents short of estimates. Its stock was down 2.7% in pre-market trading.
The Dow Jones industrial futures were down 26 points to 12,387, the Nasdaq futures fell 1.5 points to 2,377 while the S&P 500 futures lost 3.3 points to 1,288.4.
The TSX was on track to end the week positive as weak Chinese trade data raised hopes that banking officials in that country are set to relax lending requirements in order to encourage growth, which sent copper prices surging more than six per cent and resource stocks higher. China is the world’s biggest consumer of the metal, which is viewed as an economic bellwether as it is used in so many businesses.
Traders were also relieved at successful government bond auctions in Italy and Spain, which indicated rising investor confidence in both countries.
The auctions also reinforced hopes that policymakers may finally be getting a grip on Europe’s debt crisis after months of procrastination and indecision.
On Friday, Italy saw its borrowing costs drop for a second day in a row as it easily raised €3 billion. The yield on the three-year bonds fell to 4.83%, down from the average interest rate of 5.62% it had to pay last month and far lower than the 7.89% rate it had to pay in November.
Oil prices were little changed with the February contract in New York off three cents to US$99.07 a barrel.
Oil fell $1.77 Thursday amid rumours that Europe would delay its embargo of Iranian oil. Oil prices had been steadily rising amid fears of a supply crunch if a coordinated embargo were put in place.
The March copper contract edged two cents lower to US$3.63 a pound while February gold declined $5.10 to US$1,642.60 an ounce.
European markets were mixed as London’s FTSE 100 was off 0.07%, Frankfurt’s DAX rose 0.31% and the Paris CAC 40 gained 0.97%.
Earlier, Japan’s Nikkei 225 index rose 1.4% and Hong Kong’s Hang Seng index rose 0.6%.
Mainland China’s benchmark Shanghai Composite Index lost 1.3% while the Shenzhen Composite Index dropped 3.5%.