Equities
Global markets were mixed, with some surrendering earlier gains, as uncertainty weighed on investor sentiment following massive selloffs that were driven by fears of a U.S. recession and a tech sector pullback.
Japan’s Nikkei regained more than 10 per cent, rebounding from a 12.4-per-cent drop yesterday in its biggest daily selloff since the 1987 Black Monday crash.
Wall Street’s main indexes opened higher as investors hunted for bargains after yesterday’s global stock rout, while dovish rate commentary from Federal Reserve officials also lifted the mood.
The Dow Jones Industrial Average rose 1.16 points at the open to 38,704.43, the S&P 500 advanced 17.73 point, or 0.34 per cent to 5,204.06, while the Nasdaq Composite gained 63.7 points or 0.39 per cent to 16,263.7 at the opening.
The Toronto Stock Exchange’s S&P/TSX composite index opened down 542.04 points or 2.44 per cent at 21,685.59 miners leading broad declines, as investors caught up the global selloff after a holiday break..
In Canada, investors are getting results from Great-West Lifeco Inc., Suncor Energy Inc., Dream Industrial REIT and Pet Valu Holdings Ltd.
On Wall Street, markets are watching earnings from Airbnb Inc., Uber Technologies Inc., Nuvei Corp. and Caterpillar Inc.
“I think people got a bit carried away yesterday and it always seems very dramatic at the time,” IG chief market strategist Chris Beauchamp said. “It’s normal to see weakness this time of year. The question is – was that enough to reset markets or is there going to be more?”
Overseas, the pan-European STOXX 600 was down 0.46 per cent in morning trading. Britain’s FTSE 100 fell 0.36 per cent, Germany’s DAX slipped 0.11 per cent and France’s CAC 40 retreated 0.65 per cent.
Hong Kong’s Hang Seng closed 0.31 per cent lower.
Commodities
Oil prices pared gains in volatile trade as fears of an escalation in the Middle East conflict and a drop in production at Libya’s largest Sharara oilfield raised the prospect of tight supplies.
Brent crude futures were down 0.12 per cent to US$76.21 a barrel, while West Texas Intermediate (WTI) crude futures dropped 0.11 per cent to US$72.86. Both benchmarks fell about 1 per cent yesterday.
Weak demand figures, particularly in China, have limited oil market rallies. “A long-awaited seasonal upturn in demand in Q3 seems to be disappointing. Use of on-road fuels like gasoline and diesel is coming below initial bullish expectations,” Onyx Capital Group analyst Harry Tchilinguirian said.
In other commodities, gold prices inched higher and analysts noted that the non-yielding metal’s outlook remains positive as latest commentary from Federal Reserve officials and data point toward bigger U.S. interest rate cuts.
Spot gold was up 0.3 per cent to US$2,413.90 an ounce and U.S. gold futures gained 0.5 per cent to US$2,455.30 an ounce.
Currencies and bonds
The Canadian dollar weakened against its U.S. dollar counterpart.
The day range on the loonie was 72.17 US cents to 72.50 US cents in early trading. The Canadian dollar was down about 1.43 per cent against the greenback over the past month.
The U.S. dollar index, which weighs the greenback against a group of currencies, advanced 0.46 per cent to 103.16.
The euro slipped 0.35 per cent to US$1.0915. The British pound fell 0.76 per cent to US$1.268.
In bonds, the yield on the U.S. 10-year note was last up at 3.838 per cent.
Other corporate news
Uber beat Wall Street estimates for second-quarter revenue and core profit, helped by steady demand for its ride-sharing and food-delivery services. The company’s revenue rose 16 per cent to US$10.7-billion, compared with an expected US$10.57-billion, according to LSEG data.
Caterpillar has reported a rise in quarterly adjusted profit, lifted by resilient demand for its larger excavators and other construction equipment amid increased infrastructure spending in the United States. But sales and revenue fell from a year earlier.
KFC and Taco Bell parent Yum Brands has recorded a bigger-than-expected fall in same-store sales for the second quarter as sticky inflation discouraged lower-income Americans from spending on dining out.
Economic news
China trade surplus
Japan real cash earnings and household spending
Euro zone retail sales
(8:30 a.m. ET) Canada’s merchandise trade balance for June.
(8:30 a.m. ET) U.S. goods and services trade balance for June.
(9:30 a.m. ET) Canada’s S&P Global Services PMI for July.
With Reuters and The Canadian Press