Canada’s main stock index opened higher on Tuesday on renewed hopes of resolving the ongoing trade dispute between the United States and China.
The Toronto Stock Exchange’s S&P/TSX composite index was up 20.91 points, or 0.14 per cent, at 15,177.31
The S&P 500 and the Nasdaq opened higher on Tuesday, boosted by a rebound in technology stocks and hopes of progress in the U.S.-China trade talks, while losses in Boeing Co and Home Depot Inc weighed on the Dow.
The Dow Jones Industrial Average fell 65.97 points, or 0.26 per cent, at the open to 25,321.21. The S&P 500 opened higher by 3.83 points, or 0.14 per cent, at 2,730.05. The Nasdaq Composite gained 29.82 points, or 0.41 per cent, to 7,230.69 at the opening bell.
Shares of Home Depot fell over 1 per cent in early trading despite the U.S.'s No. 1 home improvement chain exceeded analyst estimates for quarterly comparable-store sales.
The report comes in a big week for retail earnings, with results from companies including Walmart Inc and Macy’s Inc likely to show how rising wages in the United States are eating into margins.
Also helping was a report that China’s top trade negotiator was preparing to visit the United States before a meeting between the leaders of the world’s two largest economies.
“It seems like some pressure regarding trade has been alleviated,” said Andre Bakhos, managing director at New Vines Capital LLC in Bernardsville, New Jersey. “However, the market will take a defensive posture until visibility increases with regard to trade.”
The development comes as China President Xi Jinping and U.S. President Donald Trump plan to meet on the sidelines of a G20 summit that is being held in Argentina at the end of November.
The main indexes tumbled on Monday as shares of Apple Inc slid 5 per cent after several suppliers to the iPhone maker cut their forecasts, signaling that demand for iPhones could be softening.
Following that, Goldman Sachs cut its earnings estimate for Apple and another key supplier Foxconn, reported a weaker-than-expected rise in quarterly profit.
Apple’s shares were down 0.2 per cent, set for its fourth day of losses.
After a stellar rally for technology shares that has fueled a decade-long gain for U.S. stocks, appetite for the group has started to wane lately on concerns about tighter regulation and demand for chipmakers.
Allocation to the global tech sector collapsed to the lowest since February 2009, according to a Bank of America Merrill Lynch survey that also showed the S&P 500 index was broadly expected to rise 12 per cent more before peaking.
Oil prices fell more than 2 per cent on Tuesday after U.S. President Donald Trump put pressure on OPEC not to cut supply to prop up the market.
Brent dropped $1.97 a barrel, or 2.8 per cent, to a low of $68.15 before recovering to around $68.52, down $1.60. U.S. light crude was $1.35 lower at $58.48.
Both crude benchmarks have fallen more than 20 per cent since peaking at four-year highs in early October.
“The market now increasingly looks concerned about the prospect of too much supply,” said Norbert Ruecker, head of macro and commodity research at Swiss bank Julius Baer.
“Hedge funds and other speculative (investors) have swiftly changed from the long to the short side.”
Top crude exporter Saudi Arabia has watched with alarm how supply has started to outpace consumption, fearing a repeat of a glut that brought a price crash in 2014.
Saudi Energy Minister Khalid al-Falih said on Monday the Organization of the Petroleum Exporting Countries agreed there was a need to cut oil supply next year by around 1 million barrels per day (bpd) from October levels to prevent oversupply.
But Trump has made it clear he wants oil prices to fall.
“Hopefully, Saudi Arabia and OPEC will not be cutting oil production. Oil prices should be much lower based on supply!” the president said in a Twitter post on Monday.
That led to a sharp price drop on Monday and the sell-off continued into Tuesday.
“This tweet certainly did not help prices,” ING commodities strategist Warren Patterson said.
Reuters