Equities
Global markets were mixed ahead of inflation data that could pave the way for rate cuts in the United States and Europe.
The S&P 500 and the Dow opened higher, with markets focused on results from AI-darling Nvidia on Wednesday and a key inflation report due later in the week, while geopolitical tensions in the Middle East made investors wary.
The Dow Jones Industrial Average rose 0.06 per cent to 41,200.84, the S&P 500 gained 0.09 per cent to 5,639.66, and the Nasdaq Composite fell 0.06 per cent to 17,867.85 at the bell.
The Toronto Stock Exchange’s S&P/TSX composite index opened 0.4 per cent higher at 23,378.69, lifted by the energy stocks tracking higher crude prices.
Canadian investors looking ahead to the rest of the big six banks releasing their third-quarter results later in the week, after Toronto-Dominion Bank reported last week. Bank of Montreal and Bank of Nova Scotia report tomorrow.
Markets are getting earnings from BHP Group Ltd. today.
“We continue to expect the [Fed] to deliver an initial string of three consecutive 25 [basis point] cuts at the September, November, and December meetings,” said analysts at Goldman Sachs.
“Our forecast rests on our assumption that the August employment report will be stronger than the July report, but we continue to think that if instead the August report is weaker than we expect, then a 50bp cut would be likely.”
Overseas, the pan-European STOXX 600 was rose 0.15 per cent in morning trading. Germany’s DAX was flat and France’s CAC 40 advanced 0.3 per cent. British markets were closed for a holiday.
In Asia, Japan’s Nikkei closed 0.66 per cent lower, while Hong Kong’s Hang Seng rose 1.06 per cent.
Commodities
Oil prices extended gains on reports of a near total production stoppage in Libya, adding to earlier gains on concerns that escalating conflict in the Middle East could disrupt regional oil supplies.
Brent crude futures climbed 2.91 per cent to US$81.32 a barrel, while West Texas Intermediate (WTI) crude futures were at US$77.05 a barrel, up 2.97 per cent.
“The biggest risk for the oil market is probably a further drop in Libyan oil production due to political tensions in the country, with a risk that production could fall from current levels of 1 million barrels per day to zero,” said analyst Giovanni Staunovo of Swiss bank UBS.
In other commodities, gold prices firmed. Spot gold rose 0.6 per cent to US$2,524.30 an ounce after gaining more than 1 per cent in the previous session. U.S. gold futures also gained 0.6 per cent to US$2,560.40.
Currencies and bonds
The Canadian dollar strengthened against its U.S. counterpart.
The day range on the loonie was 73.92 US cents to 74.14 US cents in early trading. The Canadian dollar was up about 2.68 per cent against the greenback over the past month.
The U.S. dollar index, which weighs the greenback against a group of currencies, rose 0.15 per cent to 100.87.
The euro slid 0.33 per cent to US$1.1157. The British pound fell 0.18 per cent to US$1.3193.
In bonds, the yield on the U.S. 10-year note was last down at 3.781 per cent.
Other business news
Prime Minister Justin Trudeau says Canada will impose a 100-per-cent tariff on Chinese-made electric vehicles, along with 25 per cent tariffs on aluminum and steel from China, in an effort to protect domestic manufacturing.
Economic news
Germany business sentiment, which fell for a third consecutive month in August, a survey showed, pushing back recovery hopes for Europe’s largest economy.
(8:30 a.m. ET) U.S. durable and core orders for July. Core orders unexpectedly fell in July and data for the prior month was revised lower, suggesting a loss of momentum in business spending on equipment that extended into the early part of the third quarter.
(10:30 a.m. ET) U.S. Dallas Fed Manufacturing Activity for August.
With Reuters and The Canadian Press