Equities
Most stocks held steady, suggesting that the market impact of escalating Middle East tensions has been contained for now.
Wall Street’s main indexes opened lower as investors priced in a possible escalation in geopolitical tensions in the Middle East, while a survey allayed concerns about a rapid cooldown in the labour market.
The Dow Jones Industrial Average fell 0.08 per cent to 42,125.14, the S&P 500 slipped 0.19 per cent to 5,698.14, and the Nasdaq Composite dropped 0.24 per cent to 17,867.124 at the bell.
The Toronto Stock Exchange’s S&P/TSX composite index opened 0.15 per cent higher at 24,069.96, tracking the heavyweight energy sector.
In Canada, investors are getting results from NovaGold Resources Inc. and Tilray Inc.
“While these [geopolitical] events typically reconcile in a market-positive fashion, the tail risk it can throw up is clearly significant,” said Chris Weston, head of research at Pepperstone. “The situation remains fluid, and the slightest calming or increased aggression in the rhetoric from Israel or Iran could result in a sizeable impact on sentiment in markets.”
Overseas, the pan-European STOXX 600 was down 0.18 per cent in morning trading. Britain’s FTSE 100 gained 0.1 per cent, Germany’s DAX was down 0.6 per cent and France’s CAC 40 was little changed.
In Asia, Japan’s Nikkei closed 2.18 per cent lower, while Hong Kong’s Hang Seng rose 6.2 per cent.
Commodities
Oil prices climbed on rising concerns that Middle East tensions could escalate, potentially disrupting crude output from the region, following Iran’s biggest ever military blow against Israel.
Brent futures advanced 3.07 per cent to US$75.82 a barrel, while West Texas Intermediate (WTI) crude spiked 3.4 per cent to US$72.22.
Both crude benchmarks yesterday surged more than 5 per cent before closing at about 2.5 per cent higher.
Iran said early today that its missile attack on Israel was over barring further provocation, while Israel and the U.S. promised to strike back against Tehran.
“This could include damaging or obliterating Iran’s oil facilities,” said Tamas Varga of oil broker PVM.
In other commodities, spot gold eased 0.4 per cent to US$2,653.12 an ounce, following a more than 1-per-cent jump yesterday that brought it close to last month’s record high. U.S. gold futures slid 0.06 per cent to US$2,673.90 an ounce.
Currencies and bonds
The Canadian dollar strengthened against its U.S. counterpart.
The day range on the loonie was 74.05 US cents to 74.21 US cents in early trading. The Canadian dollar was up about 0.15 per cent against the greenback over the past month.
The U.S. dollar index, which weighs the greenback against a group of currencies, climbed 0.11 per cent to 101.30.
The euro gained 0.05 per cent to US$1.1073. The British pound inched higher to US$1.3287.
In bonds, the yield on the U.S. 10-year note was last up at 3.767 per cent.
Economic news
Euro zone jobless rate
(8:15 a.m. ET) U.S. ADP National Employment Report for September. U.S. private payrolls increased more than expected, further evidence that labour market conditions were not deteriorating.
Also: OPEC JMMC meeting
With Reuters and The Canadian Press