Equities
Global markets advanced modestly on optimism that U.S. rate cuts could start next month after the release of Federal Reserve minutes yesterday and as central bankers gather at the Jackson Hole Symposium starting today.
Wall Street’s main indexes opened higher on rate-cut optimism. The Dow Jones Industrial Average rose 0.10 per cent to 40,932.23, the S&P 500 advanced 0.30 per cent to 5,637.77, and the Nasdaq Composite increased 0.42 per cent to 17,993.72 at the bell.
The Toronto Stock Exchange’s S&P/TSX composite index opened 0.12 lower at 23,083.45, as mining shares dragged.
In Canada, investors are getting third-quarter results from Toronto-Dominion Bank, which is setting aside an additional US$2.6-billion to cover looming penalties in the United States over failures in the bank’s anti-money-laundering program.
The country’s second-largest lender reported net loss was $181-million, or 14 cents per share, in the three months ended July 31, compared with a profit of $2.88-billion, or $1.53 per share, a year earlier.
On Wall Street, markets are watching earnings from Peloton Interactive Inc., which reported its first sales increase in nine quarters and beat estimates, and Intuit Inc.
“What we have seen since yesterday is just a confirmation of broad expectations of Fed rate cuts in September,” said Sandrine Perret, multi-asset portfolio manager at Unigestion.
Overseas, the pan-European STOXX 600 was up 0.42 per cent in morning trading. Britain’s FTSE 100 was flat, Germany’s DAX added 0.27 per cent and France’s CAC 40 rose 0.21 per cent.
In Asia, Japan’s Nikkei closed 0.68 per cent higher, while Hong Kong’s Hang Seng rose 1.44 per cent.
Commodities
Oil prices were steady after falling for four straight days as investors worried about the global demand outlook, but a decline in U.S. fuel inventories provided a floor.
Brent crude futures gained 0.5 per cent to US$76.40 a barrel, while West Texas Intermediate (WTI) crude futures was 0.3 per cent higher at US$72.17.
“Weak global demand and the potential threat on OPEC+ rolling back on their production cuts are weighing on oil,” said Priyanka Sachdeva, a senior market analyst at Phillip Nova, adding that conflict in the Middle East and geopolitical tensions elsewhere are tilting risks to the upside.
In other commodities, spot gold was down 0.2 per cent at US$2,507.32 an ounce, after hitting a record high on Tuesday. U.S. gold futures dropped 0.1 per cent to US$2,543.40.
Currencies and bonds
The Canadian dollar strengthened against its U.S. counterpart.
The day range on the loonie was 73.54 US cents to 73.69 US cents in early trading. The Canadian dollar was up about 1.79 per cent against the greenback over the past month.
The U.S. dollar index, which weighs the greenback against a group of currencies, advanced 0.3 per cent to 101.33.
The euro declined 0.06 per cent to US$1.1144. The British pound rose 0.28 per cent to US$1.3126.
In bonds, the yield on the U.S. 10-year note was last up at 3.832 per cent.
Economic news
Japan machine tool orders and PMI
(8:30 a.m. ET) U.S. initial jobless claims for week of Aug. 17, which came in at seasonally adjusted 232,000. Estimate is 235,000, up 8,000 from the previous week.
(9:45 a.m. ET) U.S. S&P Global PMIs for August.
(10 a.m. ET) U.S. existing home sales for July. Consensus is a rise of 0.3 per cent on an annualized rate basis.
Also: Jackson Hole Economic Policy Symposium (through Saturday)
With Reuters and The Canadian Press