Equities
Global markets were little changed in cautious trading, as investors looked ahead to Nvidia earnings tomorrow as well as U.S. inflation data later this week to bolster the Federal Reserve’s case for interest rate cuts.
Wall Street’s main indexes followed the sentiment lower. The Dow Jones Industrial Average fell 0.13 per cent to 41,186.28, and the S&P 500 dropped 0.25 per cent to 5,602.89, and the Nasdaq Composite gave back 0.40 per cent at 17,655.52 at the opening bell.
The Toronto Stock Exchange’s S&P/TSX composite index opened 0.59 lower at 23,212.11, weighed down by mining and technology stocks.
Bank of Montreal has reported a drop in third-quarter profit, hurt by weakness in its U.S. retail segment, as it set aside bigger loan-loss provisions. The bank’s adjusted net income stood at $1.98-billion, or $2.64 per share, in the three months ended July 31, compared with $2.15-billion, or $2.94 per share, a year earlier.
Bank of Nova Scotia also recorded a fall in third-quarter profit, with more funds put aside to cover for potential credit losses. Net income was $1.91-billion or $1.41 per share, compared with $2.19-billion or $1.70 per share a year earlier.
“It would be a real shock not to get a [Fed] rate cut in September,” said Guy Miller, chief market strategist at Zurich Insurance Group, adding an initial 25-basis-point cut was most likely.
“It was also interesting that [Fed chairman Jerome Powell] didn’t really push against the market expectations of 100 plus basis points of rate cuts between now and year-end,” in his comments at the Jackson Hole symposium last week, Miller added.
Overseas, the pan-European STOXX 600 was up 0.19 per cent in morning trading. Britain’s FTSE 100 was up 0.34 per cent, Germany’s DAX rose 0.47 per cent and France’s CAC 40 added 0.05 per cent.
In Asia, Japan’s Nikkei closed 0.47 per cent higher, while Hong Kong’s Hang Seng gained 0.43 per cent.
Commodities
Oil prices slipped slightly after rebounding more than 7 per cent over the previous three sessions on supply concerns prompted by fears of widening Middle East conflict and potential shutdown of Libyan oil fields.
Brent crude futures were down 0.58 per cent at US$80.96 a barrel. West Texas Intermediate (WTI) crude futures dropped 0.7 per cent to US$76.88.
“Markets remain on edge as skirmishes between Israel and Hezbollah intensify,” ANZ analysts said in a note.
In other commodities, spot gold declined 0.3 per cent to US$2,510.02 an ounce, while U.S. gold futures fell 0.4 per cent to US$2,545.40.
Currencies and bonds
The Canadian dollar strengthened against its U.S. counterpart.
The day range on the loonie was 74.04 US cents to 74.28 US cents in early trading. The Canadian dollar was up about 2.78 per cent against the greenback over the past month.
The U.S. dollar index, which weighs the greenback against a group of currencies, edged higher to 100.87.
The euro slid 0.07 per cent to US$1.1155. The British pound gained 0.13 per cent to US$1.3204.
In bonds, the yield on the U.S. 10-year note was last up at 3.862 per cent.
Other corporate news
7-Eleven stores operator Seven & i is seeking designation as a “core” company in Japan to ensure sharper government oversight on some purchases of its shares, Bloomberg News said, amid takeover talks with Alimentation Couche-Tard.
The report cited people familiar with the matter and said Japan’s Ministry of Finance would have to thoroughly investigate any entity which seeks to acquire more than 10 per cent of a company considered part of a core industry.
Economic news
China industrial profits
Germany GDP
(8:30 a.m. ET) Canadian wholesale trade for July.
(9 a.m. ET) U.S. S&P CoreLogic Case-Shiller Home Price Index (20 city) for June. Consensus is a gain of 0.3 per cent from May and 6.2 per cent year-over-year.
(9 a.m. ET) U.S. FHFA House Price Index for June. Estimate is a month-over-month increase of 0.1 per cent and 5.2-per-cent gain from the same period a year ago.
(10 a.m. ET) U.S. Conference Board Consumer Sentiment Index for August.
With Reuters and The Canadian Press