Equities
Global markets started the week cautiously, as investors prepared for U.S. inflation numbers to gauge the Federal Reserve’s monetary policy path and a deluge of other key data.
Wall Street opened higher as indexes add to their recovery from a hammering early last week. The Dow Jones Industrial Average was up 0.02 per cent at 39,500 points, the S&P 500 gained 0.24 per cent to 5,356.23 points, and the Nasdaq Composite rose 0.45 per cent to 16,820 points at the bell.
The Toronto Stock Exchange’s S&P/TSX composite index opened 0.3 per cent higher at 22,378.84, lifted by commodity-linked shares.
Investors are getting results from Sun Life Financial Inc., Barrick Gold Corp., Ballard Power Systems Inc. and Extendicare Inc.
Barrick edged past Wall Street estimates for second-quarter profit, as the company benefited from higher prices and robust production.
Economists are looking for rises of 0.2 per cent in both the headline and core U.S. inflation on Wednesday, with the annual core slowing a tick to 3.2 per cent.
“That would likely bolster the Fed’s confidence that disinflation is ongoing, allowing for a rate cut in September, but a core run-rate still above target should also speak against a larger 50bp cut or an intra-meeting cut,” analysts at Barclays said in a note.
Overseas, the pan-European STOXX 600 added 0.13 per cent in morning trading. Britain’s FTSE 100 gained 0.4 per cent, Germany’s DAX rose 0.2 per cent and France’s CAC 40 gave back 0.1 per cent.
In Asia, Hong Kong’s Hang Seng closed 0.13 per cent higher while Japan’s market was closed for a holiday.
Commodities
Oil prices rose for a fifth consecutive session, extending gains from the previous week’s more than 3-per-cent rise, as U.S. recession fears eased while geopolitical tensions in the Middle East supported prices.
Brent crude futures were up 1.1 per cent to US$80.54 a barrel, while West Texas Intermediate (WTI) crude futures rose 1.38 per cent to US$77.
“Support is coming from last week’s better-than-expected U.S. data which eased fears of a U.S. recession,” IG markets analyst Tony Sycamore said. “There is also a great deal of anxiety about when Iran might look to avenge Israel’s assassination of key Hamas and Hezbollah leaders. Feels like a matter of when - not if.”
In other commodities, gold prices rose to a one-week high, driven by safe-haven inflows. Spot gold was up 0.9 per cent at US$2,453.77 an ounce, while U.S. gold futures gained 0.8 per cent to US$2,493.90.
Currencies and bonds
The Canadian dollar weakened against its U.S. dollar counterpart.
The day range on the loonie was 72.68 US cents to 72.90 US cents in early trading. The Canadian dollar was down about 0.31 per cent against the greenback over the past month.
The U.S. dollar index, which weighs the greenback against a group of currencies, advanced 0.09 per cent to 103.23.
The euro inched higher to US$1.0924. The British pound slipped 0.06 per cent to US$1.2769.
In bonds, the yield on the U.S. 10-year note was last down at 3.939 per cent ahead.
Other corporate news
Bank of Nova Scotia has bought a roughly 14.9-per-cent stake in U.S. regional lender KeyCorp. in an all-stock deal worth US$2.8-billion.
South Africa’s Gold Fields has agreed to acquire Canada’s Osisko Mining for $2.16-billion, barely two years after an attempt to buy Yamana Gold was scuppered by a rival offer.
Tourmaline Oil says it will acquire Crew Energy in a $1.3-billion deal, which includes debt, to boost its presence in the Montney shale play in Alberta.
Economic news
8:30 am ET: Canada building permits for June. BMO expects a 10-per-cent rise, rebounding from May’s 12.2-per-cent decline
2 pm ET: U.S. budget balance
With Reuters and The Canadian Press