Equities
Global markets were subdued as market enthusiasm about Washington and Beijing extending their tariff truce to November was tempered by jitters about U.S. inflation data.
Wall Street futures rose after largely in-line consumer prices data kept bets of a Federal Reserve interest rate cut in September in tact.
TSX futures edged lower after Canada’s main stock index posted marginal gains yesterday.
In Canada, investors are getting results from CAE Inc., Northwest Healthcare Properties REIT, Cineplex Inc. and Superior Plus Corp.
“The core message in core inflation is that any tariff-induced inflation is likely to be a process, not an event. Eventually, tariffs can show up in varying degrees in consumer prices, but these one-off price increases don’t happen all at once,” said Brian Jacobsen, chief economist at Annex Wealth Management.
“As long as breakeven inflation rates and other market based measures of inflation expectations stay contained, the Fed should feel comfortable enough to recommence cutting in September.”
Overseas, the pan-European STOXX 600 was up 0.15 per cent in morning trading. Britain’s FTSE 100 rose 0.14 per cent, Germany’s DAX eased 0.13 per cent and France’s CAC 40 gained 0.49 per cent.
In Asia, Japan’s Nikkei closed 2.15 per cent higher, reaching an all-time high, while Hong Kong’s Hang Seng climbed 0.25 per cent.
Commodities
Oil prices were broadly steady on the U.S.-China tariff truce, easing concerns an escalation of their trade war would hit oil consumption.
Brent crude futures lost 2 US cents to US$66.61 a barrel, while West Texas Intermediate (WTI) crude futures eased 0.2 per cent to US$63.86.
Potentially weighing on the oil market, U.S. President Donald Trump and Russian President Vladimir Putin are due to meet in Alaska on Friday to discuss an end to the war in Ukraine.
“If Friday’s meeting brings a ceasefire or even a peace deal in Ukraine closer, Trump could suspend the secondary tariffs imposed on India last week before they come into force in two weeks,” Commerzbank said in a note.
“If not, we could see tougher sanctions against other buyers of Russian oil, like China.”
In other commodities, spot gold was little changed at US$3,345.59 an ounce. U.S. gold futures for December delivery were down 0.2 per cent to US$3,394.10.
Gold slipped 1.6 per cent yesterday, while futures dropped by more than 2 per cent after Trump said tariffs will not be placed on imported gold bars, easing jitters in the market.
Currencies and bonds
The Canadian dollar was flat against its U.S. counterpart.
The day range on the loonie was 72.42 US cents to 72.65 US cents in early trading. The Canadian dollar was down about 0.42 per cent against the greenback over the past month.
The U.S. dollar index, which weighs the greenback against a group of currencies, fell 0.22 per cent to 98.32.
The euro gained 0.28 per cent to US$1.1649. The British pound advanced 0.49 per cent to US$1.3499.
In bonds, the yield on the U.S. 10-year note was last down at 4.265 per cent.
Economic news
U.K. employment
(8:30 a.m. ET) Canadian building permits for June. Estimate is a month-over-month decline of 5.0 per cent.
(8:30 a.m. ET) U.S. CPI for July, which increased 0.2 per cent from June and 2.7 per cent year-over-year, in line with expectations.
(2 p.m. ET) U.S. budget balance for July.
With Reuters and The Canadian Press