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Canada’s main stock index opened down Thursday with commodities-related shares weighing on sentiment. On Wall Street, the Dow and S&P 500 had a flat start as weakness in tech shares offset a better-than-expected reading on U.S. retail sales.
At 9:32 a.m. ET, the Toronto Stock Exchange’s S&P/TSX composite index was down 54.26 points, or 0.26 per cent, at 20,639.53.
In the U.S., the Dow Jones Industrial Average fell 4.12 points, or 0.01 per cent, at the open to 34,810.27.
The S&P 500 opened lower by 3.61 points, or 0.08 per cent, at 4,477.09. The Nasdaq Composite dropped 41.44 points, or 0.27 per cent, to 15,120.09 at the opening bell.
“It continues to be a seesaw week for stock markets, with U.S. markets taking a downward move after Wednesday’s bounce while European stock indices manage to hold on to their gains for the day,” IG chief market analyst Chris Beauchamp said.
“U.S. retail sales provided a point of light in an otherwise dull session...relieving fears that the world’s most important economy was seeing a sustained slowdown in consumer spending.”
Before the start of trading, the U.S. Commerce Department said August retail sales rose 0.7 per cent. Economists had been expecting to see a decline of about 0.8 per cent.
At the same time, the U.S. Labor Department reported that weekly jobless claims rose to 332,000, more than the 320,000 economists had been forecasting.
Thursday’s U.S. economic numbers come ahead of next week’s Federal Reserve policy decision. Markets have been trying to gauge how soon the U.S. central bank will begin tapering its bond purchases.
Canadian investors got an update on the housing market ahead of the opening bell.
Canada Mortgage and Housing Corp. said the seasonally adjusted annual rate of housing starts in Canada fell 3.9 per cent to 260,239 in August. Multiple urban starts were down 5.7 per cent while single-detached starts fell 2 per cent.
On the corporate side, The Globe reports that Teck Resources Ltd. has held talks with Lundin Mining Corp. and Glencore PLC as the Vancouver mining company continues to weigh its options for unloading its coal business. Mining industry sources said that Teck chief executive officer Don Lindsay held deal talks with Toronto-based copper miner Lundin and Glencore, the Swiss mining and commodities trading giant, in the past year or so, but discussions with both companies ultimately went nowhere.
Overseas, the pan-European STOXX 600 was up 0.80 per cent by afternoon. Britain’s FTSE 100 rose 0.50 per cent. Germany’s DAX added 0.76 per cent. France’s CAC 40 gained 1.08 per cent.
In Asia, Japan’s Nikkei ended down 0.62 per cent. Hong Kong’s Hang Seng had another losing session, falling 1.46 per cent.
Crude prices slid despite new figures showing a sharp drop in weekly U.S. inventories.
The day range on Brent is US$75.21 to US$75.87. The range on West Texas Intermediate is US$72.34 to US$72.99. Both benchmarks advanced on Wednesday with Brent hitting its best level since July.
“With WTI now firmly back above US$70 and Brent closing in on its summer highs, we could see some profit-taking soon, although there aren’t yet many signs of this happening,” OANDA senior analyst Craig Erlam said.
“The momentum indicators at worst are flattening off but we’re now seeing them slow just yet. Perhaps activity in the Gulf will see oil prices hit new summer highs but momentum will be key to the rally being sustained.”
Sentiment got a boost from the latest inventory figures from the U.S. Energy Information Administration. The EIA said U.S. crude stocks fell by 6.4 million barrels last week, more than analysts expected, as offshore facilities in the Gulf of Mexico worked to recover from the impact of hurricane Ida.
Reuters reports that oil is also finding support from a sharp rise in European power prices, which have surged due to a number of factors including low gas inventories and lower-than-normal gas supply from Russia.
In other commodities, gold prices slid, with a firmer U.S. dollar and U.S bond yields weighing on its appeal.
Spot gold was 0.5 per cent down at US$1,784.35 per ounce, while U.S. gold futures also fell 0.5 per cent to US$1,785.10.
The Canadian dollar was down slightly, but still above 79 US cents, as its U.S. counterpart advanced against a group of world currencies.
The day range on the loonie is 79.04 US cents to 79.27 US cents.
“The CAD is trading in familiar ranges on the session so far. Higher energy prices are boosting Canada’s terms of trade but the CAD is not — yet — feeling the benefit,” Shaun Osborne, chief FX strategist with Bank of Nova Scotia, said in an early note.
On world markets, the U.S. dollar index, which weighs the greenback against a selection of currencies, rose 0.2 per cent to 92.626, little changed from Wednesday. Markets are now turning their attention to next week’s Federal Reserve policy decision.
The index managed a two-week high early this week, but then pulled back to a one-week low of 92.887 after a tamer-than-forecast reading on U.S. inflation, according to figures from Reuters.
The U.S. dollar gained 0.1 per cent to 109.28 yen, after sliding to a six-week low of 109.110 in the previous session.
The euro was 0.2-per-cent lower at US$1.1786.
The Australian dollar slid 0.2 per cent to US$0.7315. The New Zealand dollar edged up 0.1 per cent to US$0.7112.
More company news
TC Energy Corp. says it has signed a deal to sell its remaining 15 per cent stake in the Northern Courier Pipeline to a partnership including Suncor Energy Inc. and eight Indigenous communities. Financial terms of the agreement were not immediately available.
The Globe’s Steven Chase reports that the State of Michigan says it sees no further use for mediation talks with Enbridge Inc. over Governor Gretchen Whitmer’s effort to shut down the Line 5 pipeline, a crucial petroleum conduit for Ontario and Quebec. This development would appear to hamper chances for a negotiated settlement to the dispute. In a Sept. 15 court filing in the U.S. District Court for the Western District of Michigan, Michigan Attorney-General Dana Nessel said the state feels no further mediation sessions would be helpful.
(8:15 a.m. ET) Canadian housing starts for August.
(8:30 a.m. ET) Canada’s wholesale trade for July.
(8:30 a.m. ET) Canada’s international securities transactions for July.
(8:30 a.m. ET) U.S. initial jobless claims for week of Sept. 11.
(8:30 a.m. ET) U.S. retail sales for August.
(8:30 a.m. ET) U.S. Philadelphia Fed Index for September.
(10 a.m. ET) U.S. business inventories for July.
With Reuters and The Canadian Press