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Equity
Canada’s main stock index opened higher on Wednesday and miners advanced due to rising gold prices. On Wall Street, key indices also rose with the expected Federal Reserve rate hike for traders and investors.
At 9:31 a.m. ET, the Toronto Stock Exchange’s S & P / TSX composite index rose 94.91 points, or 0.49 percent, to 19,643.42.
In the U.S., the Dow Jones Industrial Average rose 205.67 points, or 0.68 percent, at the opening to 30,570.50.
The S&P 500 opened up 28.57 points, or 0.76 percent, at 3,764.05, while the Nasdaq Composite gained 140.06 points, or 1.29 percent, to 10,968.40. the opening bell.
Market attention on Tuesday will be firmly on the Fed’s rate decision, scheduled for 2 p.m. ET.
Traders now expect a 75 basis point rise, the highest since 1994. Just last week, expectations had been a half-percentage point increase by the powerful central bank. But a warmer-than-expected reading of inflation on Friday in May increased pressure on the Fed to take aggressive action to control price pressures.
“The market is priced at almost 100 percent, a 75 basis point FOMC rise. [on Wednesday]Said OANDA senior analyst Jeffrey Halley.
“My two cents value is that the Fed will not go up to 100 basis points, as this would further erode its credibility on the front of the forward guidance, which is already uneven. However, they may decide to upgrade their forward orientation to an even more hawk inclination “.
He said another three-quarter increase is likely to be expected at the next Fed meeting.
“If the targeting is more modest in scope, I’m sure the purchase of the cases will be in effect for the rest of the week,” he said.
Meanwhile, the ECB surprised markets with the word that it would hold an unscheduled meeting to talk about the volatility of bond markets. The ECB later said it would tip the reinvestment of overdue debt to help more indebted members and devise a new instrument to stop fragmentation, seeking to temper the market crash that has fueled fears of a new debt crisis. a Reuters report.
“The governing council will hold an ad hoc meeting on Wednesday to discuss current market conditions,” an ECB spokesman told Reuters. It was unclear whether the central bank would issue a statement outside the meeting.
In this country, the Canadian Real Estate Association published sales of existing homes in May just before the start of negotiations. CREA said home sales fell 8.6 percent in May, adding to the biggest drop seen in April. As a result, monthly activity was at pre-COVID-19 levels and only slightly above the 10-year average.
As for companies, Andrew Willis of the Globe reports that Kinross Gold Corp. it sells its Russian mines for $ 340 million, half the price the company previously negotiated after the Russian government imposed limits on the size of the sale. In March, Kinross suspended operations on its two properties in Siberia in response to Russia’s invasion of Ukraine. In April, Canada’s third-largest gold producer announced it would sell the mines to Highland Gold Mining for $ 680 million, with $ 100 million in advance and the rest paid for five years.
Abroad, the pan-European STOXX 600 was up 1.03% at noon. The British FTSE 100 gained 1.07%. Germany’s DAX and France’s CAC 40 rose 1.01% and 0.96%, respectively.
Goods
Crude oil prices fell in an uneven session amid concerns over demand as the Federal Reserve prepares to raise interest rates.
The daily range in Brent is US $ 119.57 to US $ 121.88. The range at West Texas Intermediate is $ 117.18 to $ 119.61.
“The oil outlook cannot remain uncorrelated with the not-so-rude sentiment and health of the global economy over time,” said Stephen Innes, managing partner of SPI Asset Management.
“However, in the short term, with summer drivers still queuing for gas, regardless of price amid ongoing supply problems, oil prices remain relatively robust despite growing uncertainty over world economy “.
Later this morning, markets will get U.S. government information figures from the U.S. Energy Information Administration.
Analysts polled by Reuters expect crude oil stocks to fall more than 1 million barrels last week. Gasoline stocks are expected to rise by about 800,000 barrels.
Meanwhile, gold prices rose from a one-month low, helped by weak Treasury yields.
Cash gold rose 0.4% to $ 1,815.89 an ounce in the early hours of Wednesday morning, after falling to its lowest level since May 16 at $ 1,803.90 on Tuesday. U.S. gold futures rose 0.1% to $ 1,815.20.
Goods
The Canadian dollar remained stable at first, while the US dollar fell against a basket of world currencies and the euro advanced ahead of the news of an unscheduled ECB meeting.
The loonie’s day range is from 77.08 US cents to 77.33 US cents.
In world markets, the euro rose 0.7 percent against the U.S. dollar to $ 1.04945 after the European Central Bank said it would hold a surprise meeting to discuss bond sales.
The U.S. dollar index, which measures the green dollar against major peers, fell 0.37% to 104.90 ahead of the Fed’s rate hike, according to Reuters figures.
The Australian dollar, often seen as an indicator of risk appetite, stands at US $ 0.69135, up 0.6% from a month earlier, Reuters reported.
More company news
United States chip maker Qualcomm on Wednesday it won its fight against a $ 1.05 billion fine imposed by EU antitrust regulators four years ago, marking a major setback to the crackdown on EU antitrust chief Margrethe Vestager against Big Tech. The European Commission in its 2018 decision said Qualcomm paid billions of dollars to Apple from 2011 to 2016 to use only its chips on all its iPhones and iPads to block rivals like Intel Corp.
Elon Musk on Wednesday appealed a judge’s refusal to end its 2018 deal with the U.S. Securities and Exchange Commission, which required a Tesla Inc’s lawyer to verify some of his posts on Twitter. Musk, who is Tesla’s chief executive, is appealing the April 27 ruling that allowed the agreement to be filed in the Court of Appeals for the second U.S. circuit in Manhattan, according to a document judicial.
Economic news
(8:15 am ET) Canadian housing starts in May.
(8:30 am ET) May retail sales in the US.
(8:30 am ET) US trade price indices for May.
(8:30 am ET) US Empire State Manufacturing Survey for June.
(9 am ET) Existing home sales in Canada for May.
(9 am ET) Canada’s MLS Home Price Index for May.
(10 am ET) June US NAHB Housing Index.
(10:00 ET) US Trade Inventories for April.
(2 pm ET) US Fed announcement and summary of economic projections with President Jerome Powell’s press conference below.
With Reuters and The Canadian Press