Equities
Global markets were higher with the release of U.S. inflation figures this morning and the Federal Reserve policy decision this afternoon that could determine the near-term outlook for interest rates.
Consumer price index figures came in softer than expected. Inflation was unchanged on a monthly basis, where it was expected to rise 0.1 per cent. On an annual basis, inflation rose 3.3 per cent, lower than economists’ expectation of a 3.4 per cent increase.
Wall Street stocks jumped at the open, with the S&P 500 and the Nasdaq touching fresh record highs. The Dow Jones Industrial Average was last up 0.68 per cent at 39,011.3, the S&P 500 advanced 0.86 per cent to 5,421.34 and the Nasdaq Composite was up 0.88 per cent at 17,343.55.
The S&P/TSX composite index opened 0.94 per cent higher at 22,093.37.
In Canada, investors are getting results from Dollarama Inc.
On Wall Street, markets will be watching earnings from Broadcom Inc.
“Today is a big day in terms of economic data and Fed announcement - it could determine the global market mood for the rest of the month, and a good part of summer,” Ipek Ozkardeskaya, senior analyst at Swissquote Bank, wrote in a note.
Overseas, the pan-European STOXX 600 was 0.53 per cent higher in morning trading, rising for the first time in four days. Britain’s FTSE 100 gained 0.62 per cent, Germany’s DAX added 0.54 per cent and France’s CAC 40 advanced 0.38 per cent.
In Asia, Japan’s Nikkei closed 0.66 per cent lower at 38,876.71, while Hong Kong’s Hang Seng fell 1.31 per cent to 17,937.84.
Commodities
Oil prices extended gains for a third straight session amid upbeat global demand views from the U.S. Energy Information Administration and OPEC, reinforced by industry data showing U.S. crude oil inventories fell more than expected last week.
Brent futures rose 0.9 per cent to US$82.68 a barrel, while West Texas Intermediate (WTI) crude futures gained 1.1 per cent to US$78.76 a barrel.
“Despite announcing last week that it will start to phase out some of the voluntary cuts later this year, [OPEC’s] forecasts suggest it should be easily accepted by the market,” ANZ analysts said in a note.
In other commodities, gold prices edged 0.1 per cent lower to US$2,313 an ounce.
Currencies and bonds
The Canadian dollar strengthened against its U.S. counterpart, which tumbled on weaker-than-expected inflation numbers.
The day range on the loonie was 72.66 US cents to 73.08 US cents in the early premarket period. The Canadian dollar was down about 0.64 per cent against the greenback over the past month.
The U.S. dollar index, which weighs the greenback against a group of currencies, dropped 0.63 per cent to 104.6.
The euro advanced 0.67 per cent to US$1.081. The British pound gained 0.14 per cent to US$1.2757, shrugging off data that showed the British economy did not grow in April, after a strong start to 2024.
In bonds, the yield on the U.S. 10-year note slid 0.1 per cent to 4.294 per cent ahead of the North American opening bell.
Other corporate news
Dollarama has reported a 20-per-cent profit jump in its first quarter, as Canadians rattled by more than two years of rising prices are consistently turning to discount stores looking for some relief. The Montreal-based retailer is also seeing demand for discount stores in other markets, announcing today that it has increased its stake in Latin American retailer Dollarcity.
Economic news
China CPI and PPI
Germany CPI
(8:30 a.m. ET) U.S. CPI for May.
(2 p.m. ET) U.S. Fed announcement and summary of economic projections with chair Jerome Powell’s press briefing to follow.
(3:15 p.m. ET) Bank of Canada Governor Tiff Macklem joins a panel at the Conference of Montreal.
With Reuters and The Canadian Press