Before the Bell: What every Canadian investor needs to know today

Equities

Global markets saw gains after U.S. Federal Reserve chairman Jerome Powell’s cautiously encouraging testimony to Congress yesterday buoyed hopes that interest rate cuts could start as early as September.

On Wall Street, Nasdaq and S&P 500 futures pointed higher, ahead of a closely watched U.S. inflation report tomorrow, where core consumer prices are expected to hold steady in June.

TSX futures were in positive territory, lifted by gains in oil and precious metal prices.

“The main takeaway [from Powell’s comments] is that, moving forward, the jobs data will generate as much euphoria as the inflation numbers,” Ipek Ozkardeskaya, senior analyst at Swissquote Bank, said in a note. “… Investors will be more eager to put an accidental uptick, or less ideal inflation numbers, in perspective and remain confident that things – in terms of rate cut expectations – are moving toward the right direction.”

Powell’s semi-annual testimony continues today.

Overseas, the pan-European STOXX 600 was up 0.58 per cent in morning trading. Britain’s FTSE 100 gained 0.61 per cent, Germany’s DAX added 0.67 per cent and France’s CAC 40 rose 0.79 per cent.

In Asia, Japan’s Nikkei closed 0.61 per cent higher, while Hong Kong’s Hang Seng declined 0.29 per cent.

Commodities

Oil prices ticked higher on expectations that U.S. crude and gasoline inventories fell last week, but further gains were limited by the restart of output in the U.S. Gulf as the threat from Hurricane Beryl faded and slack Chinese consumer demand.

Brent futures rose 0.2 per cent to US$84.85 a barrel, while U.S. West Texas Intermediate (WTI) crude gained 0.3 per cent to US$81.69 a barrel.

“Expectations for easing tensions in the Middle East and Chinese weaker-than-expected CPI data for June pressed on oil prices today,” said independent market analyst Tina Teng.

In other commodities, spot gold rose 0.4 per cent to US$2,372.83 an ounce, while U.S. gold futures climbed 0.5 per cent to US$2,379.20 an ounce.

Currencies and bonds

The Canadian dollar was little changed against its U.S. counterpart.

The day range on the loonie was 73.28 US cents to 73.39 US cents in the early premarket period. The Canadian dollar was up about 0.63 per cent against the greenback over the past month.

The U.S. dollar index, which weighs the greenback against a group of currencies, slipped 0.04 per cent to 105.09.

The euro gained 0.1 per cent to US$1.0824. The British pound advanced 0.17 per cent to US$1.2809.

In bonds, the yield on the U.S. 10-year note was last down at 4.28 per cent ahead of the North American opening bell.

Economic news

Chinese June consumer prices and producer prices

10 am ET: U.S. Fed Chair Powell testifies to the House Financial Services Committee.

10 am ET: U.S. wholesale inventories for May.

With Reuters and The Canadian Press