Canada’s main stock index dipped at Monday’s opening bell with weaker metals prices weighing on materials stocks. On Wall Street, key indexes as traders turned their focus from news that a partial U.S. government shutdown had been averted to continuing uncertainty about the path ahead of interest rates.
At 9:31 a.m. ET, the Toronto Stock Exchange’s S&P/TSX composite index was down 21.91 points, or 0.11 per cent, at 19,519.36.
In the U.S., the Dow Jones Industrial Average fell 52.00 points, or 0.16 per cent, at the open to 33,455.50.
The S&P 500 opened lower by 3.53 points, or 0.08 per cent, at 4,284.52, while the Nasdaq Composite dropped 1.34 points, or 0.01 per cent, to 13,217.99 at the opening bell.
Sentiment on Monday was helped by weekend news that an agreement had been reached to fund the U.S. government through to Nov. 17, averting a partial shutdown. However, the move also left the door open for a similar showdown next month. The bill was approved by the U.S. Senate on a broad partisan basis and was singed into law by President Joe Biden.
“As it turns out a deal was struck over the weekend as Republican and Democrats kicked the can down the road and reset the clock for another 45 days until 17th November when we’re likely to have to go through the same political circus,” Michael Hewson, chief market analyst with CMC Markets U.K., said.
“It also means markets can turn their attention back to the economic data, and focus on last Friday’s [U.S.] core PCE deflator inflation numbers which showed a further easing of inflationary pressure in August, slipping to 3.9 per cent from 4.3 per cent.”
In Canada, the week’s key economic release comes on Friday, with the release of employment figures for September.
“RBC Economics is forecasting a 25,000 increase in September employment as surging population growth is helping to fill open positions,” Alvin Tan, Asia FX strategist with RBC, said.
“The unemployment rate has begun to rise, climbing to 5.5 per cent over July and August from 5 per cent in the spring. We look for another tick up to 5.6 per cent in September.”
U.S. jobs numbers will also be released on Friday morning. Mr. Tan says RBC’s economists are expecting to see an above-consensus gain for the month of about 177,000 new jobs. He noted that the latest data is unlikely to reflect the impact of the UAW targetted strikes by auto workers based on the timing of the disruption.
On the corporate side, Laurentian Bank said early Monday that Éric Provost has been appointed president and chief executive officer, while Michael Boychuk has been appointed to the role of chair of the board. Both appointments are with immediate effect. The bank said Michael Mueller has resigned as chair while Rania Llewellyn will leave immediately as President and CEO
Overseas, the pan-European STOXX 600 was down 0.37 per cent by midday. Britain’s FTSE 100 slid 0.44 per cent. Germany’s DAX and France’s CAC 40 lost 0.20 per cent and 0.25 per cent, respectively. Data released Monday showed euro zone manufacturing activity remained in a deep downturn last month with demand shrinking.
In Asia, Japan’s Nikkei finished down 0.31 per cent. Hong Kong’s Hang Seng was closed.
Crude prices edged up in early trading as risk sentiment improved and traders look ahead to the midweek meeting of the OPEC+ group.
The day range on Brent was US$92 to US$92.77 in the early premarket period. The rang on West Texas Intermediate was US$90.62 to US$91.41.
Both benchmarks saw losses on Friday but saw prices rally roughly 30 per cent in the third-quarter of the year, helped by moves by OPEC+ members Russia and Saudi Arabia to extend voluntary production curbs through to the end of the year.
OPEC+ members meet on Wednesday, but markets are expecting any changes to the current output plan.
“No changes are expected to the outlook policy, the rising demand and falling supply continue to support higher oil prices,” Swissquote senior analyst Ipek Ozkardeskaya said in an early note.
In other commodities, gold prices were down for a sixth session, hit by continued strength in the U.S. dollar.
Spot gold dropped 0.3 per cent to US$1,842.79 per ounce by early Monday morning, its lowest since March 10. U.S. gold futures shed 0.4 per cent to US$1,858.60.
“Gold feels like it’s tied to a stone and thrown into the sea,” Ms. Ozkardeskaya said.
“Oversold market conditions hint that we should soon see a pause and correction, but the U.S. yields look appetizing and a potential fall in the yields would make the stocks appetizing leaving little room for gold to make a comeback,” she said.
The Canadian dollar was down while its U.S. counterpart pulled back slightly but continued to trade near 10-month highs against world currencies.
The day range on the loonie was 73.52 US cents to 73.74 US cents ahead of the North American opening bell. The Canadian dollar slid more than 1 per cent against the greenback over the last five days and has lost more than 2 per cent in the third quarter.
On world markets, the U.S. dollar index, which weighs the greenback against a selection of world currencies, edged back from its recent 10-month high and was last at 106.21. The index saw its best quarterly performance in a year in the third quarter, according to figures from Reuters.
Elsewhere, the euro was little changed at US$1.0574, after ending the previous quarter with a 3-per-cent decline, its worst performance in a year, Reuters reported.
Britain’s pound was last 0.1-per-cent lower at US$1.2189. The pound lost almost 4 per cent against the U.S. dollar in the third quarter.
In bonds, the yield on the U.S. 10-year note was higher at 4.621 per cent in the predawn period.
More company news
Tesla missed market estimates for third-quarter deliveries on Monday as the automaker was forced to curb production due to planned factory shutdowns, sending its shares down 3.7% in trading before the bell. The electric-vehicle maker handed over 435,059 vehicles in the three months to Sept. 30, down nearly 7% from the preceding quarter. The world’s most valuable automaker produced 430,488 vehicles in the third quarter, compared with 479,700 in the second quarter and 365,923 a year earlier. -Reuters
Rogers Communications Inc. says customers of all of the major Canadian wireless carriers can now connect to its 5G wireless network in the busiest sections of the Toronto subway system. The company says subway riders will be able to connect to its 5G network while in the Line 1 stations and tunnels in the so-called Downtown U from Union Station north to St. George and Bloor-Yonge, plus Spadina and Dupont stations. The area encompasses all of the subway stops in Toronto’s downtown core. -The Canadian Press
(9:30 a.m. ET) Canada’s S&P Global Manufacturing PMI for September.
(9:45 a.m. ET) U.S. S&P Global Manufacturing PMI for September.
(10 a.m. ET) U.S. ISM Manufacturing PMI for September.
(10 a.m. ET) U.S. construction spending for August. The Street is projecting an increase of 0.6 per cent from July.
(11 a.m. ET) U.S. Fed chair Jerome Powell participates in a roundtable discussion in York, Pa.
With Reuters and The Canadian Press