Equities
Global markets were cautious as the prospect of political deadlock in France took the shine off optimism about an early U.S. interest rate cut.
Wall Street’s main indexes rose at the open, with the Nasdaq and the S&P 500 notching fresh intraday highs, as investors looked ahead to a week packed with inflation readings, testimony by Federal Reserve chairman Jerome Powell and the start of the corporate earnings season.
The Dow Jones industrial average advanced 0.58 per cent to 39,603.83, S&P 500 gained 0.21 per cent to 5,579.10 and the Nasdaq Composite was up 0.9 per cent at 18,352.76.
Toronto Stock Exchange’s S&P/TSX composite index opened on a subdued note, up 0.05 per cent at 22,069.81.
The earnings calendar is quiet on both sides of the border.
“It will be difficult for France to form a government and as the most likely potential outcome is now some arrangement between parts of the left and Macron,” said Holger Schmiedling, chief economist at Berenberg.
“This could mean some reform reversals rather than further reforms. The outcome I would say is less bad than could have been the case.”
Overseas, the pan-European STOXX 600 was last up 0.44 per cent. Britain’s FTSE 100 rose 0.27 per cent, Germany’s DAX gained 0.47 per cent and France’s CAC 40 added 0.19 per cent.
In Asia, Japan’s Nikkei closed 0.32 per cent lower at 40,780.70, while Hong Kong’s Hang Seng dropped 1.55 per cent to 17,524.06.
Commodities
Oil prices slid after rising for four weeks, as the prospect of a ceasefire deal in Gaza eased tensions in the Middle East, while investors assessed potential disruption to U.S. energy supplies from Hurricane Beryl.
Brent crude futures were down 0.77 per cent at US$85.87 a barrel, while West Texas Intermediate (WTI) crude was at US$82.16 a barrel, down 1.2 per cent.
“If anything concrete comes from the ceasefire talks, it will take some of geopolitical bid out of the market for now,” said IG analyst Tony Sycamore based in Sydney.
In other commodities, gold prices slipped after bullion hit a more than one-month high in the previous session on rising bets of U.S. interest rate cuts in September.
Spot gold fell 0.6 per cent to US$2,377.75 an ounce and U.S. gold futures eased 0.5 per cent to US$2,385.50.
Currencies and bonds
The Canadian dollar strengthened against its U.S. counterpart.
The day range on the loonie was 73.26 US cents to 73.42 US cents in the early premarket period. The Canadian dollar was up about 1 per cent against the greenback over the past month.
The U.S. dollar index, which weighs the greenback against a group of currencies, slipped 0.03 per cent to 104.85.
The euro was up slightly at US$1.0842. The British pound gained 0.22 per cent to US$1.2842.
In bonds, the yield on the U.S. 10-year note inched higher to 4.288 per cent.
Economic news
3 pm ET: U.S. consumer credit
With Reuters and The Canadian Press