Equities
Global stocks tumbled in a tech tailspin after the worst day for the Nasdaq since 2022 as investor confidence was undermined by disappointing earnings from heavyweights Alphabet and Tesla.
The main U.S. indexes opened flat as investors drew comfort from stronger-than-expected economic growth data, a day after megacap stocks steered a Wall Street slide.
The Dow Jones Industrial Average fell 0.06 per cent to 39,828.63, the S&P 500 advanced 0.03 per cent to 5,428.70, and the Nasdaq Composite gained 0.06 per cent to 17,352.64.
The Toronto Stock Exchange’s S&P/TSX composite index opened 0.19 per cent lower at 22,597.09 as losses in metal prices pulled down mining share.
Canada’s largest grocer, Loblaw, and its parent company, George Weston Ltd., have agreed to pay $500-million to settle two class-action lawsuits over their role in a scheme to fix bread prices in Canada from 2001 to 2015. As Susan Krashinsky Robertson reports, the companies are the first to reach a settlement in the lawsuits.
Investors are getting results from Loblaw as well as Bombardier.
On Wall Street, markets are watching earnings from AstraZeneca, Union Pacific, Unilever, Honeywell, Norfolk Southern, Vale, Southwest Airlines and American Airlines.
“Traders have played outright defense, as the saturated and well-owned tech position continues to be unwound,” said Chris Weston, head of research at Pepperstone.
“We can also add an ongoing unease around China’s growth trajectory, very poor PMIs in Europe and a bearish opinion piece from ex-New York Fed member Bill Dudley, and investors and traders derisked and de-grossed portfolios.”
Overseas, the pan-European STOXX 600 was down 1.49 per cent in morning trading. Britain’s FTSE 100 slid 0.55 per cent, Germany’s DAX gave back 1.36 per cent and France’s CAC 40 retreated 2.04 per cent.
In Asia, Japan’s Nikkei closed 3.28 per cent lower, while Hong Kong’s Hang Seng fell 1.77 per cent.
Commodities
Oil prices fell on mixed demand signals a day after large draws on U.S. inventories while consumption in China, the world’s largest crude importer, remains lacklustre.
Brent crude futures for September dropped 1.1 per cent to US$80.80 a barrel, and West Texas Intermediate (WTI) crude for September slid 1.1 per cent to US$76.8574 barrel.
In other commodities, gold prices fell more than 1 per cent, hitting its lowest level in two weeks, as investors squared positions to focus on U.S. economic data that could offer additional insights into the timing of the Federal Reserve’s potential interest rate cuts.
Spot gold dropped 1.2 per cent to US$2,369.29 an ounce, and U.S. gold futures declined 1.9 per cent to US$2,368.80.
Currencies and bonds
The Canadian dollar weakened against its U.S. dollar counterpart.
The day range on the loonie was 72.20 US cents to 72.45 US cents in early trading. The Canadian dollar was down about 0.92 per cent against the greenback over the past month.
The U.S. dollar index, which weighs the greenback against a group of currencies, was flat at 104.39.
The euro slid 0.01 per cent to US$1.0842. The British pound dropped 0.27 per cent to US$1.2872.
In bonds, the yield on the U.S. 10-year note was last down at 4.269 per cent.
Other corporate news
Loblaw has reported second-quarter net earnings of $457-million or $1.48 per share, compared with $508-million or $1.58 per share a year earlier. It says the lawsuit settlement negatively impacted earnings by $121-million, driving profits down by 10 per cent in the quarter.
Stellantis has pledged to take steps to address problems in North American and elsewhere, including cutting output and prices, after the world’s No. 4 car maker delivered worse-than-expected first-half results, sending its shares down 10 per cent in premarket trading.
Meta’s Oversight Board said today the company’s rules were “not sufficiently clear” in barring sexually explicit AI-generated depictions of real people and called for changes to stop such imagery from circulating on its platforms.
Economic news
Germany and France business confidence
8:30 am ET: Canada payroll survey and job vacancy rate for May
8:30 am ET: U.S. real GDP for the second quarter, which accelerated at a 2.8 per cent annual rate, blowing past consensus estimates of 1.9 per cent.
8:30 am ET: U.S. durable goods orders for June. Consensus is for a rise of 0.4 per cent
9:30 am ET: U.S. initial jobless claims
With Reuters and The Canadian Press