Investors will find few reasons to send stock markets higher this week as U.S. economic growth data will likely serve as a reminder of how conditions in the world’s biggest economy are deteriorating.
There are high hopes from a slew of earnings coming from the big Canadian banks. But while they’re expected to hand in solid numbers, it could be a stretch for them to improve or even meet the results from the previous two quarters.
North American markets put in a mixed performance last week. The TSX gained 1.68 per cent but that was largely on the back of the resource sector as PotashCorp shares surged in the wake of a $38.6-billion US hostile takeover bid by Australian resource giant BHP Billiton.
The base metals sector gained 1.74 per cent on hopes that other companies could be ripe for a takeover with a fat share price premium.
But overall sentiment was weak and the Dow Jones industrials fell 0.86 per cent as economic data Thursday, particularly a rise in jobless insurance claims, deepened the belief the American economic recovery is faltering.
Investors will get their best take on the U.S. economy Friday when the government makes its first revision to second-quarter gross domestic product growth. The initial report assessed growth coming in at an annual rate of 2.4 per cent and this new look will likely disappoint.