Global markets took a step back on Tuesday as geopolitical tensions weighed on investor sentiment ahead of key earnings reports from major AI-driven companies. Wall Street futures showed mixed signals, with the Dow pointing higher, while TSX futures dipped into negative territory following a retreat from Canada’s main stock index the previous day. Investors are closely monitoring earnings from a range of companies, including Netflix Inc., GE Aerospace, General Motors Co., and others, with hopes that strong results could help overshadow ongoing economic and political uncertainties.
Oil prices surged as traders factored in a geopolitical risk premium amid Houthi attacks on Saudi infrastructure and reports of vessel attacks in the Gulf. Brent crude futures climbed 1.73% to US$111.50, while West Texas Intermediate (WTI) futures rose 2% to US$100.50. Analysts at ING noted that oil prices remain well-supported, indicating that the market is pricing in significant volatility due to the geopolitical situation.
In other commodities, spot gold fell 0.5% to US$4,120.49 an ounce, while U.S. gold futures for December delivery dropped by 0.5% to US$4,139.10. The Canadian dollar strengthened slightly against the U.S. dollar, trading at $1.4056 per US$1. The U.S. dollar index declined 0.16% to 101.83, while the euro and British pound saw modest gains.
Economic data releases are also in focus, with key reports including U.S. ADP employment data, Canadian household and mortgage credit data, and U.S. housing starts and building permits scheduled for release throughout the day.