Equities
Canada’s main stock index slid at Thursday’s opening bell as markets weigh a better-than-forecast reading on jobs growth in March. On Wall Street, key indexes also started in the red with higher-than-expected jobless claims again raising concern about economic growth.
At 9:32 a.m. ET, the Toronto Stock Exchange’s S&P/TSX composite index was down 29.41 points, or 0.15 per cent, at 20,130.14.
In the U.S., the Dow Jones Industrial Average fell 61.76 points, or 0.18 per cent, at the open to 33,420.96. The S&P 500 opened lower by 9.23 points, or 0.23 per cent, at 4,081.15, while the Nasdaq Composite dropped 57.78 points, or 0.48 per cent, to 11,939.08 at the opening bell.
“Coming on top of the weaker manufacturing data earlier in the week there appears to be a feeling that markets want to believe that the economy is slowing, which it probably is, that recent rate rises are to blame, and that the Fed will need to reverse course soon when it comes to rate policy,” Michael Hewson, chief market analyst with CMC Markets U.K., said in a note.
“Tomorrow’s [U.S.] non-farm payrolls report is the next catalyst for that narrative, although judging by recent weekly jobless claims data the U.S. labour market still seems pretty solid.”
Economists are expecting to see about 240,000 new jobs added in the U.S. in March, down from 311,000 a month earlier. Average earnings growth is seen slowing to 4.3 per cent year-over-year. The report is due Friday morning, although stock markets will be closed for Good Friday.
U.S. weekly jobless claims, released early Thursday, came in higher than market forecasts. A Labor Department report showed initial claims for state unemployment benefits stood at 228,000 last week. Economists polled by Reuters had expected 200,000 jobless claims in the latest week.
Meanwhile, Canada’s March jobs numbers was released this morning.
Statistics Canada says the Canadian economy added about 35,000 new jobs last month, better than the roughly 10,000 economists had been forecasting. The unemployment rate held steady at 5 per cent in March.
“While the Bank of Canada is expected to remain on hold next week, the still low unemployment rate and strong wage growth will likely see policymakers maintaining a bias towards further hikes, rather than hinting at the cuts markets have been pricing in, within the statement,” CIBC senior economist Andrew Grantham said.
On the corporate side, The Globe’s Jameson Berkow reports this morning that Aimia Inc. is facing a revolt from its largest shareholder. Mithaq Capital SPC, a family office based in Saudi Arabia that owns nearly 20 per cent of Toronto-based Aimia, announced plans Thursday to vote against the re-election of the company’s entire board of directors. Aimia, which sold its flagship Aeroplan loyalty program to Air Canada in 2019 for $516-million, has recently sought to reinvent itself as an investment holding company.
Overseas, the pan-European STOXX 600 was up 0.57 per cent by midday. Britain’s FTSE 100 gained 0.78 per cent. Germany’s DAX and France’s CAC 40 were up 0.39 per cent and 0.34 per cent, respectively.
In Asia, Japan’s Nikkei lost 1.22 per cent. Hong Kong’s Hang Seng advanced 0.28 per cent.
Commodities
Crude prices dipped in early trading but were still on track for a solid weekly gain in the wake of the surprise OPEC+ decision to cut output.
The day range on Brent was US$84.05 to US$84.98 in the early premarket period. The range on West Texas Intermediate was US$79.65 to US$80.55.
Both benchmarks were on track for weekly gains of about 6 per cent, despite modest losses in early trading on Thursday morning.
Markets are sifting through mixed signals in recent days, with weaker U.S. economic data again raising concerns about the economy, but continued declines in inventories offering optimism on demand.
“Crude prices are wavering after weakening U.S. economic data was countered by a larger than expected draw with stockpiles as demand across all products roared back,” OANDA senior analyst Ed Moya said.
“Energy traders digested a round of U.S. data that suggests the world’s largest economy is headed towards a recession, but then had a rather bullish EIA crude oil inventory report that was immediately followed by a decision from the Saudis to increase oil prices to their Asian customers.”
In other commodities, gold pulled back from one-year highs as the U.S. dollar steadied.
Spot gold fell 0.4 per cent to US$2,013.13 per ounce by early Thursday, after hitting its highest since March 2022 on Wednesday. U.S. gold futures dipped 0.2 per cent to US$2,030.70.
Currencies
The Canadian dollar was weaker while its U.S. counterpart was little changed and continued to trade near its lowest level in two months against a group of currencies.
The day range on the loonie is 74.12 US cents to 74.37 US cents in the early premarket period. The Canadian dollar is up about 0.54 per cent for the year-to-date against the greenback.
On world markets, the U.S. dollar index, which hit a two-month low this week, thanks in part to a drop in Treasury yields, was flat at 101.94, Reuters reported.
Britain’s pound was steady on the day at US$1.246, while the euro slid 0.1 per cent to US$1.09. The Japanese yen was last flat on the day at 131.25 per dollar, according to figures from Reuters.
In bonds, the yield on the U.S. 10-year note was lower at 3.281 per cent in the predawn period.
More company news
The Globe’s Niall McGee reports Sumitomo Metal Mining Co., a major holder of Teck Resources Ltd.’s super-voting Class A shares, is refusing even to take a meeting with Glencore PLC to discuss the Swiss mining giant’s unsolicited takeover proposal for Teck. Sumitomo and the Keevil family jointly control Teck’s Class A shares that carry 100 votes each. Unless both are on board with Glencore’s US$23.1-billion takeover proposal, it can’t move forward.
Levi Strauss & Co on Thursday topped Wall Street estimates for quarterly revenue, helped by steady demand for jeans and non-denim outfits such as chinos, tops and accessories despite persistently high inflation. The company’s net revenue rose to US$1.69-billion in the first quarter from US$1.59-billion a year earlier. Analysts had expected revenue of US$1.62-billion, according to Refinitiv data. -Reuters
Economic news
(8:30 a.m. ET) Canadian employment for March.
(8:30 a.m. ET) U.S. initial jobless claims for week of April 1.
(10 a.m. ET) Canadian Ivey PMI for March.
(10 a.m. ET) Global Supply Chain Pressure Index for March.
With Reuters and The Canadian Press