Equities
North American stock markets fell as investors adjusted expectations for the Federal Reserve rate cuts and exercised caution amid heightened geopolitical tensions.
Wall Street’s main indexes fell at the open on Monday, pressured by a rally in Treasury yields as investors dialed back bets on the scope of the Federal Reserve interest rate cuts this year, following an unexpectedly strong jobs report from Friday.
The Dow Jones Industrial Average fell 0.15 per cent at the open to 42,289.51. The S&P 500 fell 0.23 per cent to 5,737.8, while the Nasdaq Composite dropped 0.32 per cent to 18,080.115.
Canada’s main stock index also opened slightly lower on Monday, hurt by technology stocks, while most investors remained on the sidelines ahead of domestic and the U.S. economic data later in the week.
At 9:31 a.m. ET, the Toronto Stock Exchange’s S&P/TSX composite index was down 16.94 points, or 0.07 per cent at 24,145.89.
In corporate news, Chevron said it would sell its non-operated interest in the Athabasca Oil Sands project and its operated interest in Duvernay shale to Canadian Natural Resources for $6.5-billion.
Overseas, the pan-European STOXX 600 was up 0.33 per cent in afternoon trading. Britain’s FTSE 100 gained 0.37 per cent, Germany’s DAX was flat and France’s CAC 40 was increased 0.57 per cent.
In Asia, Japan’s Nikkei gained 1.80 per cent after the yen sank against the U.S. dollar. The Japanese currency has bounced on speculation over the central bank’s plans for interest rates since Prime Minister Shigeru Ishiba took office last week.
Meanwhile, Hong Kong’s Hang Seng was up 1.60 per cent.
Commodities
Oil prices extended gains with Brent nearing US$80 to build on last week’s steepest weekly jump since early 2023, driven by fears of a wider Middle East conflict and potential disruption to exports from the major oil-producing region.
Brent crude futures rose US$1.09, or 1.4 per cent, to US$79.14 a barrel. West Texas Intermediate (WTI) crude futures were up US$1.15, or 1.55 per cent, at US$75.53. WTI had earlier risen by more than US$2.
“Brent crude is back to challenge US$80, with activity in the options market showing increased demand for hedging the risk of further gains amid worries about a minor or, in the worst case, major supply disruption from the Middle East,” Ole Hansen, head of commodity strategy at Saxo Bank said in a note.
In other commodities, spot gold fell 0.3 per cent to US$2,645 per ounce.
Currencies and bonds
The Canadian dollar weakened against its U.S. counterpart.
The day range on the loonie was 73.49 US cents to 73.71. The Canadian dollar was down about 0.33 per cent against the greenback over the past month.
The U.S. dollar index, which weighs the greenback against a group of currencies, was flat at 102.48.
The euro was flat at US$1.0979. The British pound was down 0.37 per cent to US$1.3076.
In bonds, the yield on the U.S. 10-year note rose to 4.018 per cent ahead.
Economic news
China markets closed
Euro zone retail sales
(2 p.m. ET) U.S. budget balance for September.
(3 p.m. ET) U.S. consumer credit for August.
With Reuters, The Associated Press and The Canadian Press