Equities
Global markets sank as warnings from Meta Platforms and Microsoft about rising artificial intelligence-related costs dampened optimism regarding megacaps.
Wall Street’s main indexes opened lower as the warnings weighed on sentiment. The Dow Jones Industrial Average fell 0.44 per cent to 41,956.34, the S&P 500 dropped 0.66 per cent to 5,775.34, and the Nasdaq Composite dropped retreated 0.97 per cent to 18,427.31 at the bell.
The Toronto Stock Exchange’s S&P/TSX composite index opened 0.42 per cent lower at 24,404.74, led lower by mining stocks.
On Wall Street, markets are watching earnings from Apple Inc., Amazon.com Inc., Intel Corp., Mastercard Inc., Merck & Co. Inc., Stellantis NV and Uber Technologies Inc.
In Canada, investors are getting results from Cenovus Energy Inc., Fairfax Financial Ltd., Canadian Natural Resources Ltd., Cogeco Communications Inc. and Gildan Activewear Inc.
“Investors are pondering results from Microsoft and Meta more than the economic news,” said Peter Cardillo, chief market economist at Spartan Capital Securities.
“Still, the inflation news could up the chances the Fed pauses next week. That could be on investors’ mind and cause some more negativity in the medium term.”
Overseas, the pan-European STOXX 600 was down 0.86 per cent in morning trading. Britain’s FTSE 100 fell 0.79 per cent, Germany’s DAX dropped 0.51 per cent and France’s CAC 40 gave back 0.98 per cent.
In Asia, Japan’s Nikkei closed 0.5 per cent lower, while Hong Kong’s Hang Seng slid 0.31 per cent.
Commodities
Oil prices stabilized after rallying the previous day on stronger than expected U.S. fuel demand and reports that producer group OPEC+ could delay a planned output increase.
Brent crude futures gained 7 cents to US$72.62 a barrel. West Texas Intermediate (WTI) crude futures climbed 17 cents to US$68.78 a barrel.
“The surprise decline in U.S. gasoline stockpiles provided a buying opportunity as demand appeared stronger than anticipated,” said Toshitaka Tazawa, an analyst at Fujitomi Securities.
In other commodities, spot gold was down 0.3 per cent to US$2,778.48 an ounce after hitting a record high of US$2,790.15 earlier in the session. U.S. gold futures dropped 0.4 per cent to US$2,789.40.
Currencies and bonds
The Canadian dollar strengthened against its U.S. counterpart.
The day range on the loonie was 71.79 US cents to 71.97 US cents in early trading. The Canadian dollar was down about 2.5 per cent against the greenback over the past month.
The U.S. dollar index, which weighs the greenback against a group of currencies, slid 0.07 per cent to 103.92.
The euro advanced 0.18 per cent to US$1.0878. The British pound gained 0.15 per cent to US$1.2980.
In bonds, the yield on the U.S. 10-year note was last up at 4.306 per cent.
Other corporate news
Reduced shipments and lower pricing power slashed Stellantis revenue by 27 per cent in the third quarter, as the auto maker seeks to fix bloated inventories and poor commercial performance that led to a major profit warning last month.
Shell has reported third-quarter profits of $6-billion that exceeded forecasts by 12 per cent as higher liquefied natural gas (LNG) sales offset a sharp drop in oil refining and trading results.
Economic news
China PMI
Japan retail sales and industrial production
Euro zone CPI and jobless rate
(8:30 a.m. ET) Canada’s monthly real GDP for August, which came in flat month-over-month as expected. The data suggest the economy might have missed the Bank of Canada’s growth forecast for the third quarter
(8:30 a.m. ET) Canada’s payroll survey: Job vacancy rate for August.
(8:30 a.m. ET) U.S. personal spending for September, which rose 0.5 per cent last month compared with consensus forecast of 0.4 per cent.
(8:30 a.m. ET) U.S. core PCE price index for September, which rose O.3 per cent from August and 2.7 per cent year over year. The Federal Reserve’s preferred inflation metric was in line with economists’ expectation, supporting bets of a gradual easing of monetary policy.
(8:30 a.m. ET) U.S. initial jobless claims for week of Oct. 26, which fell by 12,000 to 216,000. That’s fewer than the 227,000 analysts forecast.
(8:30 a.m. ET) U.S. employment cost index for Q3. The Street expects a gain of 0.9 per cent from Q2 and up 4.0 per cent year-over-year.
With Reuters and The Canadian Press