Equities
Global stocks were mostly lower on Wednesday morning as markets remained sensitive to U.S. tech stocks, monetary policy signals and political instability.
In early trading on Wall Street, the Dow Jones Industrial Average fell 0.41 per cent to 38,948.58 and the S&P 500 lost 0.1 per cent to 5,463.64. The Nasdaq Composite gained 0.19 per cent to 17,750.02.
“The market is trying to figure out in real time whether it needs to focus on the biggest three stocks – Nvidia, Apple and Microsoft – or is it time for the other 497 stocks to take the baton,” said Art Hogan, chief market strategist at B Riley Wealth.
The TSX Composite Index opened 0.42 per cent lower at 21,691.46 points. Canada’s main stock index was hurt by declines in precious metal prices, but gains in energy and materials shares kept losses in check.
In Canada, investors are getting results from investment manager AGF Management Ltd., miner Novagold Resources Inc. and tech company BlackBerry Ltd.
U.S. markets are watching earnings from food company General Mills Inc. and semiconductor firm Micron Technology Inc.
European markets were also down, bracing for the upcoming vote in the French legislative election, which is set to begin on Sunday.
“The turnaround in the market – which some might see as relatively stable – could be explained by a tug of war between bulls who are cashing in recent gains and bears who are resurfacing on the back of mounting downside risks,” said Stephane Ekolo, equity strategist at TFS Derivatives.
“French election, sticky inflation, China slowdown and geopolitical tensions, to name a few,” he added.
The pan-European STOXX 600 was down 0.56 per cent. Britain’s FTSE 100 declined 0.35 per cent, while Germany’s DAX lost 0.15 per cent. France’s CAC 40 was down 0.79 per cent.
In Asia, Japan’s Nikkei closed up 1.26 per cent, while Hong Kong’s Hang Seng rose of 0.09 per cent.
Commodities
Oil prices dipped following a surprise build in U.S. crude and gasoline inventories.
Brent futures was trading at US$84.91 a barrel Wednesday morning, down about 10 US cents. West Texas Intermediate futures were trading at US$80.65 a barrel, off 19 US cents.
In other commodities, spot gold fell 0.9 per cent to US$2,299.40 per ounce.
Currencies and bonds
The Canadian dollar lost ground against its U.S. counterpart.
The day range on the loonie was 72.96 US cents to 73.26 US cents in the early premarket period. The Canadian dollar was up about 0.09 per cent against the greenback over the past month.
The U.S. dollar index, which weighs the greenback against a group of currencies, rose 0.35 per cent to 105.97.
The euro lost 0.19 per cent to US$1.0696. The British pound was down 0.31 per cent to US$1.2646.
In bonds, the yield on the U.S. 10-year note was up at 4.313 per cent ahead of the North American opening bell.
In other currency news, the Japanese yen fell to 160.39 per U.S. dollar, its weakest level since 1986, sparking speculation that Japanese authorities could intervene to strengthen the currency. The latest slide in the yen follows the Bank of Japan’s decision this month to hold off on reducing bond-buying stimulus until its July meeting.
Economic news
Germany consumer confidence
(8:30 a.m. ET) Canadian wholesale trade for May
(10 a.m. ET) Sales of new U.S. single-family homes dropped to a six-month low in May as a jump in mortgage rates weighed on demand, offering more evidence that the housing market recovery was faltering.
With Reuters and The Canadian Press