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With the U.S. and several European markets closed today for the Memorial Day holiday, and no North American economic data scheduled, the TSX shouldn't stray too far from Friday's close. But indications this morning suggest stocks will struggle to stay out of the red.
Futures for the TSX are down about 0.3 per cent, and the Stoxx 600 broad index of European shares - even though many markets there are also closed for a holiday - is down nearly 0.2 per cent. Crude oil is sliding as the U.S. dollar picked up strength overnight against major currencies.
U.S. shares fell on Friday after Federal reserve Chair Janet Yellen suggested the Fed was ready to act if the economy kept improving as expected, though a raft of recent data has suggested it is growing only modestly in the second quarter. She said delaying a policy tightening until employment and inflation hit its targets risked overheating the economy.
Stocks in China soared again overnight, with the Shanghai composite gaining 3.4 per cent to the highest level since January 2008. The rally was led by infrastructure and transport sectors after China's state planning agency announced more than 1,000 proposed projects that it is inviting private investors to help fund and build. China also announced will cut import taxes on clothing, cosmetics and some other goods by half in a new tactic to spur consumer spending and economic growth.
Traders were much less enthusiastic to build equity positions in Europe. A warning on Sunday by Greece's interior minister that the country will not be able to meet a June 5 repayment to the International Monetary Fund, and political concerns in Spain after the ruling People's Party took a battering in regional and local elections, weighed on European shares. Greek stocks were down 2.5 per cent, and the euro was down 0.25 per cent against the U.S. dollar.
Now, here's a closer look at what's going on this morning and what is still to come.
Futures:
S&P 500 -0.3 per cent; Dow -0.2 per cent; Nasdaq -0.1 per cent; S&P/TSX 60 -0.3 per cent
Equities:
Hong Kong's Hang Seng Closed for holiday
Shanghai composite index +3.36 per cent
Japan's Nikkei +0.74 per cent
London's FTSE 100 Closed for holiday
Germany's DAX Closed for holiday
France's CAC 40 -0.73 per cent
Stoxx 600 -0.18 per cent
Commodities:
WTI crude oil (Nymex Jly) -0.57 per cent at $59.38 (U.S.) a barrel
Gold (Comex Jun) -0.02 per cent at $1,204.80 (U.S.) an ounce
Copper (Comex Jul) +0.50 per cent at $2.83 (U.S.) a pound
Currencies:
Canadian dollar at 81.38 (U.S.), up 0.0005
U.S. dollar index +0.33 at 96.35
Bonds:
U.S. 10-year Treasury yield 2.21 per cent, +0.89
ECONOMIC DATA:
No major reports scheduled.
STOCKS TO WATCH:
Cenovus Energy Inc. says it has shut down production at its Foster Creek oilsands and Athabasca natural gas operations due to a nearby forest fire.
Barrick Gold Corp. has signed a deal to sell its Cowal mine in Australia to Evolution Mining for $550-million (U.S.) in cash. The gold miner says it will use the money from the sale to pay down debt.
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With files from wire services
Darcy Keith