Global stock markets showed positive momentum as investors assessed the ongoing effects of the U.S. government shutdown, which has now entered its second day. Futures for both Wall Street and the Toronto Stock Exchange (TSX) indicated upward trends. The prolonged shutdown could postpone the release of crucial economic data, including an important payroll report initially scheduled for Friday.
In the absence of this data, traders shifted their focus to a private U.S. labor market report that unexpectedly revealed job losses in September. This development strengthened expectations that the Federal Reserve might implement interest rate cuts in the near future. Kevin Thozet, an investment committee member at Carmignac, expressed a desire for a swift resolution to the shutdown, comparing the situation to “a blind man walking with a blind dog.”
Global Market Trends
Across Europe, the pan-European STOXX 600 index rose by 0.8 percent during afternoon trading. Key individual market performances included:
- Britain’s FTSE 100: flat
- Germany’s DAX: up 1.38 percent
- France’s CAC 40: up 1.38 percent
In Asia, Japan’s Nikkei index closed higher by 0.87 percent, while Hong Kong’s Hang Seng saw a 1.61 percent gain.
Commodity Updates
Oil prices faced downward pressure amid concerns regarding market oversupply. Recent price movements included:
- Brent crude futures: down 0.4 percent to US$65.09 per barrel
- West Texas Intermediate crude: also down 0.4 percent to US$61.54 per barrel
Conversely, gold prices experienced a rise, gaining 0.4 percent to reach US$3,880, as market anxieties related to the shutdown drove investors toward the precious metal.
Currencies and Bonds Overview
The Canadian dollar (CAD) weakened against the U.S. dollar (USD), trading within a range of 71.68 to 71.77 cents. Over the past month, the CAD has declined by approximately 0.85 percent against the USD.
The U.S. dollar index, which compares the USD to a selection of foreign currencies, fell by 0.14 percent, settling at 97.57. In contrast, the euro appreciated by 0.22 percent to $1.1758, while the British pound saw a marginal gain of 0.03 percent to $1.348.
The yield on the U.S. 10-year note remained stable at 4.108 percent.
Key Economic Events
Upcoming economic indicators include:
- Japan’s consumer confidence report
- Eurozone jobless rate announcement at 1:25 p.m. ET
- Speech by Bank of Canada Deputy Governor Rhys Mendes at the Ivey Business School in London, Ontario
These insights are essential for Canadian investors as they prepare for market openings and potential economic shifts.
