Equities
U.S. markets opened higher with investors looking ahead to key economic data and earnings, while stocks elsewhere in the world fell after a disappointing lack of details about China’s fiscal stimulus.
Wall Street’s main indexes rose at the opening bell, regaining some ground after a selloff in the previous session as investors turned their focus to the start of the third-quarter earnings season and key inflation data expected later this week.
The Dow Jones Industrial Average rose 0.16 per cent at the open to 42,022.65. The S&P 500 rose 0.41 per cent at the open to 5719.14, while the Nasdaq Composite rose 0.52 per cent to 18017.929.
Canada’s main stock exchange opened lower on a fall in energy shares that tracked a decline in oil prices. At 9:31 a.m., the Toronto Stock Exchange’s S&P/TSX composite index was down 0.27 per cent at 24,038.79.
On Wall Street, investors are watching earnings from PepsiCo Inc., and looking ahead to key inflation data and earnings later in the week.
Asian and European markets were down after Chinese policymakers didn’t reveal new fiscal stimulus plans as expected.
China’s CSI300 blue-chip index surged 10 per cent in early trade to as the country’s markets reopened after the week-long National Day holiday. Yet the index fell back – finishing 5.9 per cent higher – after the chairman of China’s economic planner provided little detail of fresh fiscal stimulus to complement the burst of monetary stimulus announced two weeks ago.
“Essentially the markets were anticipating China would announce a bit more detail on the fiscal stimulus measures,” said Aneeka Gupta, director of macroeconomic research at WisdomTree.
“Clearly that has not panned out as they’ve reopened today, and I think that’s having a bit of a dampening impact on European stocks.”
The pan-European STOXX 600 was down 0.62 per cent in early afternoon trading. Britain’s FTSE 100 lost 1.36 per cent, Germany’s DAX was down 0.32 per cent and France’s CAC 40 was also in the red, down 0.9 per cent.
Hong Kong’s Hang Seng Index slumped 9.4 per cent, giving up some of the big gains it made during the Chinese holiday, in a sign of profit-taking and waning investor patience. Japan’s Nikkei was down 1 per cent.
Commodities
Oil prices fell, breaking a five-day run of gains, as investors await Israel’s response to last week’s Iranian rocket attacks which prompted a price surge on concerns of a broader conflict in the Middle East.
Brent crude futures were down US$2.29, or 2.83 per cent, to US$78.64 per barrel. U.S. West Texas Intermediate futures were down US$2.28, or 2.96 per cent, to US$74.86 a barrel.
Both benchmark contracts rose more than 3 per cent on Monday to their highest since late August, adding to last week’s rally of 8 per cent, the biggest weekly gain in over a year, on concerns that hostilities could disrupt oil supplies from the Middle East.
“The conflict in the Middle East is boiling over and ignites fears of escalation and oil supply disruptions. The most likely scenario is another soft shock, with oil prices rising and easing again before year-end,” said Norbert Ruecker of investment bank Julius Baer.
In other commodities, spot gold fell 0.2 per cent to US$2,639.13 per ounce.
Currencies and bonds
The Canadian dollar weakened against its U.S. counterpart.
The day range on the loonie was 73.12 US cents to 73.47 US cents. The Canadian dollar was down about 0.45 per cent against the greenback over the past month.
The U.S. dollar index, which weighs the greenback against a group of currencies, gained 0.04 per cent to 102.58 .
The euro lost 0.05 per cent to US$1.097. The British pound gained 0.06 per cent to US$1.309.
In bonds, the yield on the U.S. 10-year note was up slightly to 4.041 per cent.
Economic news
China aggregate yuan financing and new yuan loans
Japan real cash earnings, household spending and current account surplus
Germany industrial production
(6 p.m. ET) U.S. NFIB Small Business Economic Trends Survey for September.
(8:30 a.m. ET) Canada’s merchandise trade balance for August.
(8:30 a.m. ET) U.S. goods and services trade deficit for August.
With Reuters and The Canadian Press