Equities
Global markets steadied near record highs even after AI powerhouse Nvidia reported results yesterday that, while beating expectations, didn’t impress investors.
Wall Street’s main indexes opened higher as data showed the U.S. economy remained robust adding to expectations of a September interest rate cut.
The Dow Jones Industrial Average rose rose 0.62 per cent to 41,345.50, the S&P 500 gained 0.27 per cent to 5,607.30, and the Nasdaq Composite advanced 0.31 per cent to 17,610.57 at the bell.
The Toronto Stock Exchange’s S&P/TSX composite index opened 0.49 per cent higher at 23,239.42 as mining and financial shares gained.
In Canada, investors are getting results from Canadian Imperial Bank of Commerce, the last of the Big Six banks to report third-quarter earnings, and Lululemon Athletica Inc.
CIBC has reported a rise in third-quarter profit on lower loan-loss provisions. Adjusted net income rose to $1.90-billion or $1.93 per share, in the three months ended July 31, from $1.48-billion or $1.52 per share a year earlier.
On Wall Street, markets are watching earnings from Best Buy, Dell Technologies Inc., Dollar General Corp. and Marvell Technology Inc.
Despite Nvidia’s third-quarter revenue forecast of US$32.5-billion surpassing Wall Street’s expectations, its second-quarter revenue outperformance was the smallest relative to analysts’ forecasts in six quarters.
“This wasn’t the sort of massive beat that Nvidia has often reported over the last 18 months,” Deutsche Bank strategist Jim Reid said.
Overseas, the pan-European STOXX 600 was up 0.75 per cent in morning trading. Britain’s FTSE 100 advanced 0.45 per cent, Germany’s DAX gained 0.73 per cent and France’s CAC 40 added 0.78 per cent.
In Asia, Japan’s Nikkei closed 0.02 per cent lower, while Hong Kong’s Hang Seng rose 0.53 per cent.
Commodities
Oil prices steadied after two sessions of losses, as supply concerns over Libya returned to focus, while a smaller-than-expected draw in U.S. crude inventories sapped demand expectations.
Brent crude futures gained 0.37 per cent to US$78.94 a barrel, while West Texas Intermediate (WTI) crude futures edged 0.48 per cent higher to US$74.88.
“A prolonged shutdown from Libya will give OPEC+ a bit more comfort in increasing supply in 4Q24 as currently planned,” ING analysts said in a client note, adding that a short disruption would makes the cartel’s decision tougher, however.
In other commodities, gold prices rose on expectations that the Fed might begin interest rate cuts next month. Spot gold was up 0.6 per cent at US$2,516.63 an ounce, and is up nearly 22 per cent this year. U.S. gold futures rose 0.5 per cent to US$2,550.00.
Currencies and bonds
The Canadian dollar strengthened against its U.S. counterpart.
The day range on the loonie was 74.15 US cents to 74.36 US cents in early trading. The Canadian dollar was up about 2.95 per cent against the greenback over the past month.
The U.S. dollar index, which weighs the greenback against a group of currencies, rose 0.28 per cent to 101.38.
The euro dropped 0.39 per cent to US$1.1077. The British pound fell 0.21 per cent to US$1.3189.
In bonds, the yield on the U.S. 10-year note was last up at 3.872 per cent.
Other corporate news
Best Buy has raised its annual profit forecast after topping second-quarter earnings expectations on Thursday, as tighter controls on costs help the electronics retailer offset the impact from steeper discounts and promotions across categories.
Dollar General has cut annual same-store sales forecast, as cost-conscious customers cut back spending on its higher-margin goods to prioritize essential purchases.
Economic news
Euro zone consumer and economic confidence
(8:30 a.m. ET) Canadian current account balance for Q2.
(8:30 a.m. ET) Canada’s Payroll Survey: Job vacancies for June were little changed at 554,000. On a year-over-year basis, job vacancies were down by 190,500 (25.6 per cent) in June..
(8:30 a.m. ET) U.S. initial jobless claims for week of Aug. 24, which fell 2,000 to a seasonally adjusted 231,000. Estimate was 235,000, up 3,000 from the previous week.
(8:30 a.m. ET) U.S. real GDP and GDDL Price Index for Q2. The Street expects annualized rate increases of 2.8 per cent and 2.3 per cent, respectively.
(8:30 a.m. ET) U.S. goods trade deficit for July.
(8:30 a.m. ET) U.S. wholesale and retail inventories for July.
(10 a.m. ET) U.S. pending home sales for July. Consensus is a gain of 0.4 per cent from June.
With Reuters and The Canadian Press