Equities
World markets were mixed after global stocks saw their best week in nine months on expectations the U.S. economy would dodge a recession and cooling inflation would kick off a cycle of interest rate cuts.
Wall Street’s main indexes opened flat after clocking their best week of the year, while investors looked ahead to Federal Reserve Chair Jerome Powell’s speech at Jackson Hole, Wyo., on Friday for rate-cut indications.
The Dow Jones Industrial Average rose 0.03 per cent to 40,670.83, the S&P 500 gained 0.05 per cent to 5,557.23, and the Nasdaq Composite advanced 0.10 per cent to 17,649.741 at the bell.
The Toronto Stock Exchange’s S&P/TSX composite index opened 0.07 lower at 23,039.22 as losses in energy and mining shares countered investor optimism about U.S. rate cuts.
Investors are getting results from Estee Lauder and Palo Alto Networks.
“Everything points to this Friday. We’ll be looking for any indication that rate cuts might be on the way. The next question is, how big will those rate cuts be?” said Paul O’Neill, chief investment officer of wealth management firm, Bentley Reid.
Overseas, the pan-European STOXX 600 gained 0.34 per cent in morning trading. Britain’s FTSE 100 was up 0.19 per cent, Germany’s DAX added 0.3 per cent and France’s CAC 40 advanced 0.46 per cent.
In Asia, Japan’s Nikkei closed 1.77 per cent lower, snapping a five-day winning run that pushed it up 8.7 per cent last week. Hong Kong’s Hang Seng advanced 0.8 per cent.
Commodities
Oil prices eased edged lower, with Brent holding below US$80 as concern over demand in top oil importer China weighed on market sentiment.
Brent crude futures dropped 0.2 per cent to US$79.49 a barrel, while West Texas Intermediate (WTI) crude futures edged lower to US$76.64. Both benchmarks fell nearly 2 per cent last Friday.
“Persistent concerns about slow demand in China led to a selloff,” said Hiroyuki Kikukawa, president of NS Trading, adding that the approaching end of peak driving season in the United States was another factor weighing on prices.
However, supply risks from tensions in the Middle East and escalation of the Russian-Ukraine war are underpinning the market, he said.
In other commodities, gold prices eased after powering to an all-time high above the US$2,500 an ounce level in the previous session on strong safe-haven demand.
Spot gold was down 0.5 per cent at US$2,494.59 an ounce, and U.S. gold futures edged 0.2 per cent lower to US$2,532.70.
Currencies and bonds
The Canadian dollar strengthened against its U.S. counterpart.
The day range on the loonie was 73.04 US cents to 73.20 US cents in early trading. The Canadian dollar was up about 0.62 per cent against the greenback over the past month.
The U.S. dollar index, which weighs the greenback against a group of currencies, declined 0.26 per cent to 102.19.
The euro gained 0.09 per cent to US$1.1039. The British pound rose 0.02 per cent to US$1.2947.
In bonds, the yield on the U.S. 10-year note was last down at 3.870 per cent.
Other corporate news
Canadian multinational Alimentation Couche-Tard Inc. is in talks to acquire 7-Eleven, the world’s largest convenience store chain, its Japanese operator revealed today.
AMD says it plans to acquire server maker ZT Systems for US$4.9-billion as the company seeks to expand its portfolio of artificial intelligence chips and hardware and battle Nvidia.
Economic news
Japan core machine orders
(8:30 a.m. ET) Canadian construction investment for June.
(8:30 a.m. ET) Canadian household and mortgage credit for June.
(10 a.m. ET) U.S. leading indicator for July. The Street expects a month-over-month decline of 0.3 per cent.
(10:30 a.m. ET) Bank of Canada Senior Loan Officer Survey for Q2.
With Reuters and The Canadian Press