Global markets saw declines as oil prices surged above US$100 per barrel due to escalating tensions in the Middle East, while broader fiscal concerns weighed on investor sentiment. Wall Street futures were trading in the red following a positive close for major North American markets, with the S&P 500 hitting a new record high the previous day. TSX futures also edged lower, reflecting cautious market moods.
In Canada, investors were focused on earnings reports from Richelieu Hardware Ltd., while on Wall Street, attention was on Levi Strauss & Co. Jeremy Batstone-Carr, an economist at Raymond James, noted the conflicting market narratives, describing a mix of rising equities, declining U.S. breadth, fluctuating yields, and volatile oil prices.
Overseas, Europe's pan-European STOXX 600 dropped 0.18 per cent, with Britain’s FTSE 100, Germany’s DAX, and France’s CAC 40 all showing modest declines. In Asia, Japan’s Nikkei closed 0.92 per cent lower, and Hong Kong’s Hang Seng slid 0.62 per cent.
Commodities saw mixed movements, with Brent crude futures rising 0.7 per cent to US$101.30 per barrel, while West Texas Intermediate (WTI) crude gained 0.28 per cent to US$89.69. Gold prices fell, with spot gold down 0.8 per cent to US$4,130.37 an ounce.
The Canadian dollar weakened against the U.S. dollar, trading at 70.25 to 70.40 US cents in early trading. Over the past month, the loonie has dropped about 2.9 per cent against the greenback. The U.S. dollar index rose 0.39 per cent to 102.23, while the euro and British pound both fell against the U.S. dollar.
In bonds, the yield on the U.S. 10-year note climbed to 5.311 per cent. Later in the day, investors will watch for the release of U.S. consumer credit data for August.