Equities
Global markets were mostly lower as building deflationary pressure in China added to growth worries from a lacklustre U.S. economy and an escalating global trade war.
Wall Street’s main indexes opened lower U.S. President Donald Trump’s comments over the weekend fanned worries that a trade war could trigger an economic slowdown, while Tesla declined following a bearish brokerage forecast.
The Dow Jones Industrial Average fell 0.69 per cent to 42,507.65, the S&P 500 dropped 1.12 per cent to 5,705.37, and the Nasdaq Composite slid 1.96 per cent to 17,840.321 at the bell.
The Toronto Stock Exchange’s S&P/TSX composite index opened 1.1 per cent lower at 24,469.59 on trade jitters while investors eyed the Bank of Canada’s next interest rate move on Wednesday. As The Globe’s Mark Rendell reports, with Trump shaking the foundations of the integrated North American economy, the central bank is widely expected to cut rates for a seventh consecutive time.
In Canada, investors are getting results from Franco-Nevada Corp.
On Wall Street, markets are watching earnings from Oracle Corp.
“I think it’s Trump’s cavalier approach to economic policy that’s rattling sentiment,” said Kyle Rodda, senior financial markets analyst at Capital.com.
“Unlike during his first administration, where signs of an economic slowdown or market correction would see a pivot on policy, he is genuinely focused on significant, structural change to the economy - even if it comes at the expense of short-term growth.”
Overseas, the pan-European STOXX 600 fell 0.9 per cent in morning trading. Britain’s FTSE 100 slid 0.75 per cent, Germany’s DAX dropped 1.34 per cent and France’s CAC 40 gave back 0.52 per cent.
In Asia, Japan’s Nikkei closed 0.38 per cent higher, while Hong Kong’s Hang Seng fell 1.85 per cent.
Commodities
Oil prices held steady as concern over the impact of U.S. tariff uncertainty and rising output from OPEC+ producers pressured prices while potential sanctions on Iranian oil exports provided some support.
Brent crude rose 9 US cents to US$70.45 a barrel. West Texas Intermediate (WTI) crude traded at US$67.19 a barrel, up 15 US cents.
Investors view uncertainty over U.S. tariffs as negative, but possible sanctions against Iran and Russia could provide support in the short term, said PVM analyst Tamas Varga.
“Looking at the bigger picture, lingering uncertainties will likely make any oil rally brief.”
In other commodities, spot gold eased 0.2 per cent to US$2,905.05 an ounce, while U.S. gold futures were steady at US$2,911.60.
Currencies and bonds
The Canadian dollar weakened against its U.S. counterpart.
The day range on the loonie was 69.37 US cents to 69.67 US cents in early trading. The Canadian dollar was down about 0.65 per cent against the greenback over the past month.
The U.S. dollar index, which weighs the greenback against a group of currencies, slipped 0.13 per cent to 103.70.
The euro rose 0.24 per cent to US$1.0860. The British pound slid 0.11 per cent to US$1.2938.
In bonds, the yield on the U.S. 10-year note was last down at 4.232 per cent.
Corporate news
Whitecap Resources says it will merge with peer Veren in an all-share deal including debt to form a US$15-billion company.
Economic news
China CPI, PPI, aggregate yuan financing and new yuan loans
Japan real cash earnings and bank lending
Germany industrial production and trade surplus. German industrial output rose in January but exports plunged, showing the challenges facing the incoming government in reviving the euro zone’s largest economy in a time of geopolitical uncertainty.
With Reuters and The Canadian Press