Equities
Global markets were mixed as upbeat earnings from chipmaking equipment maker ASML and gains in Asian semiconductor stocks recharged the AI trade, while caution remained over escalating tensions in the Middle East.
Wall Street futures pointed higher as investors assessed a fresh round of earnings reports.
TSX futures were little changed ahead of the Bank of Canada’s latest interest rate decision this morning.
As Mark Rendell reports, the central bank is expected to remain in cruise control with a string of positive economic data providing an easier backdrop for a stand-pat interest rate decision.
In Canada, investors are getting results from Cogeco Inc. and Cogeco Communications Inc.
On Wall Street, markets are watching earnings from Johnson & Johnson, Morgan Stanley, BlackRock Inc., Bank of New York Mellon Corp., PNC Financial Services Group Inc., Cintas Corp. and Kinder Morgan Inc.
“The divergence between the U.S. and Europe seems to be driven mainly by technology stocks, which are outperforming again today,” Ipek Ozkardeskaya, senior analyst at Swissquote, wrote in a note. “... ASML’s results also came in sweet, accompanied by higher-than-expected guidance for both Q3 and full-year sales.”
Overseas, the pan-European STOXX 600 was up 0.16 per cent in morning trading. Britain’s FTSE 100 declined 0.06 per cent, Germany’s DAX fell 0.49 per cent and France’s CAC 40 edged up 0.08 per cent.
In Asia, Japan’s Nikkei closed 1.49 per cent higher, while Hong Kong’s Hang Seng gained 1.4 per cent.
Commodities
Oil extended gains as U.S. President Donald Trump reimposed a naval blockade on all Iranian ports and Iran’s Islamic Revolutionary Guard threatened to close “all other export corridors that benefit the U.S. and its allies.”
Brent futures climbed 0.45 per cent to US$85.11 a barrel. West Texas Intermediate (WTI) futures rose 0.6 per cent to US$79.81 a barrel.
Analysts have said Iran has been signaling it may use its Houthi allies in Yemen to shut the Bab el-Mandeb gateway to the Red Sea, opening a new front against Washington and putting two of the world’s most vital energy arteries at risk.
In other commodities, spot gold was down 0.6 per cent to US$4,030.50 an ounce. U.S. gold futures for August delivery eased 0.8 per cent to US$4,036.20.
Currencies and bonds
The Canadian dollar strengthened against its U.S. counterpart.
The day range on the loonie was 70.95 US cents to 71.23 US cents in early trading. The Canadian dollar was up about 0.35 per cent against the greenback over the past month.
The U.S. dollar index, which weighs the greenback against a group of currencies, slid 0.05 per cent to 100.87. The dollar was pegged at $1.4054.
The euro rose 0.1 per cent to US$1.1432. The British pound gained 0.1 per cent to US$1.3403.
In bonds, the yield on the U.S. 10-year note was last up at 4.562 per cent.
Economic news
China’s real GDP, retail sales, industrial production and fixed asset investment
Japan’s core machine orders
Euro zone’s industrial production
5 a.m. ET: Canada’s existing home sales and average prices for June. As Rachelle Younglai reports, Canada’s national real estate association has further downgraded its sales forecast for the year, saying the tepid increase in home sales in Ontario will not offset declines in other parts of the country.
5 a.m. ET: Canada’s MLS Home Price Index for June. Estimate is a year-over-year decline of 3.5 per cent.
8:30 a.m. ET: Canada’s manufacturing sales, which rose for a fourth consecutive month to hit a record high in May, helped by gains in the auto sector. The 1.3 per cent month-over-month rise beat estimates of a 1.1 per cent increase.
8:30 a.m. ET: Canada’s wholesale trade for May. Estimate is a month-over-month slide of 0.7 per cent.
8:30 a.m. ET: Canada’s new motor vehicle sales for May. Estimate is a year-over-year drop of 3.0 per cent.
8:30 a.m. ET: U.S. PPI for final demand for June, which unexpectedly dropped 0.3 per cent.
9:45 a.m. ET: Bank of Canada’s policy announcement and Monetary Policy report (with press conference to follow).
10 a.m. ET: U.S. Fed’s Monetary Policy Report to the Senate Banking Committee.
With Reuters and The Canadian Press