Equities
Global stocks rose on Tuesday, with U.S. markets drifting near records notched the previous day and shares rallying in Europe and Asia.
Wall Street opened lower on Tuesday after the S&P 500 and the Nasdaq notched record high levels in the last session. Focus was on a crucial jobs report due later this week along with more data and commentary from Federal Reserve officials.
The Dow Jones Industrial Average fell 12.4 points at the open to 44769.58. The S&P 500 fell 4.2 points at the open to 6042.97, while the Nasdaq Composite dropped 39.6 points to 19364.343 at the opening bell.
Canada’s main stock index opened higher on Tuesday, boosted by mining and energy stocks, while Bank of Nova Scotia fell after missing analysts’ estimates for fourth-quarter profit.
At 9:31 a.m., the Toronto Stock Exchange’s S&P/TSX composite index was up 79.46 points at 25,669.79.
In Canada, results are also expected from technology firm Descartes Systems Group Inc.
On Wall Street, markets are watching earnings from Salesforce Inc. and Marvell Technology Inc. A day earlier, tech stocks including Facebook parent Meta Platforms and Tesla both rallied 3 per cent, pushing the Nasdaq and S&P 500 to record highs.
“There’s still really good companies who have very strong balance sheets, who have a lot of ability to generate cash,” said Timothy Graf, head of macro strategy for EMEA at State Street.
“I think a lot of the trades that have been working quite well the last two months are still performing,” he said. “The ones that haven’t worked well over the last week or two, things like crypto have come off, they don’t have those more resilient characteristics to them.”
Investors were also digesting JOLTS job openings data – a preferred gauge of U.S. Fed officials – ahead of monthly payrolls figures on Friday.
Overseas, the pan-European STOXX 600 was up 0.32 per cent in morning trading. Britain’s FTSE 100 rose 0.59 per cent, Germany’s DAX gained 0.20 per cent. France’s CAC 40 also rose 0.35 per cent, despite political turmoil in the country with the government on the brink of collapse.
In Asia, Japan’s Nikkei gained 1.91 per cent, while Hong Kong’s Hang Seng gained 1 per cent.
U.S.-listed shares of South Korean companies lost ground after President Yoon Suk Yeol declared martial law in the country.
Commodities
Oil prices rose more than 1.5 per cent on Tuesday as investors await an OPEC+ meeting expected to rubber stamp continued output cuts. A fragile ceasefire between Israel and Lebanon provided additional support.
Brent crude futures rose US$1.16 to US$72.99 a barrel while West Texas Intermediate crude was up US$1.16 at US$69.26.
OPEC+ is likely to extend its latest round of oil output cuts until the end of the first quarter when it meets on Thursday, four OPEC+ sources told Reuters.
OPEC+, which accounts for about half of the world’s oil production, has been looking to perform a gradual unwinding of production cuts through 2025.
However, the prospect of an oil market surplus has exerted downward pressure on prices, with Brent trading nearly 6 per cent below its average for December 2023.
“Given a rise in compliance with production cuts from Russia, Kazakhstan and Iraq, the lower Brent price level and indications in press reports, we assume an extension of OPEC+ production cuts ‘til April,” Goldman Sachs analysts said in a note.
In the Middle East, holes continue to appear in the ceasefire between Israel and Hezbollah. Israel on Tuesday threatened to return to war in Lebanon if its truce with Hezbollah collapses after the deadliest day since the ceasefire was agreed last week.
“Renewed tensions in Lebanon, together with market participants pricing in a three-month extension of OPEC+ production cuts, is lifting prices,” said UBS analyst Giovanni Staunovo.
Spot gold rose TO US$2,640.16 per ounce, after falling as much as 1 per cent on Monday.
Currencies and bonds
The Canadian dollar weakened against its U.S. counterpart.
The day range on the loonie was 71.06 US cents to 71.38 US cents. The Canadian dollar was down about 1.68 per cent against the greenback over the past month.
The U.S. dollar index, which weighs the greenback against a group of currencies, was down 0.06 per cent to 106.37.
The euro gained 0.06 per cent to US$1.0505. The British pound increased 0.04 per cent to US$1.2651.
In bonds, the yield on the U.S. 10-year note was up slightly at 4.203 per cent.
Economic news
(10 a.m. ET) U.S. Job Openings & Labor Turnover Survey for October.
With Reuters, The Canadian Press and The Associated Press