Canadian markets brace for mixed signals as Nvidia dip and oil prices fall
Wall Street futures rose while Nvidia shares slipped, and oil prices dropped after President Donald Trump downplayed the risk of new Iran strikes.
World equity markets edged higher on Monday, but sentiment remained fragile after Nvidia shares fell more than 4 percent in pre-market trading. The drop followed an internal probe into whether CEO Jensen Huang was the target of a foreign intelligence effort, raising concerns for the broader AI chip sector.
Wall Street futures were positive as investors searched for bargains after last week’s steep sell-off, and TSX futures rose in line with Friday’s gain on Canada’s main exchange. Canadian investors awaited results from Barrick Mining Corp., IA Financial Corp., and Peyto Exploration & Development Corp., while Wall Street focused on earnings from KKR & Co., Constellation Energy Corp. and Occidental Petroleum Corp.
"For now, the repercussions across the wider chip industry look relatively limited although the scandal could disrupt the tech rebound," said Susannah Streeter, chief investment strategist at the Wealth Club.
In Europe, the pan-European STOXX 600 gained 0.96 percent, with Britain’s FTSE 100 up 0.68 percent, Germany’s DAX climbing 1.03 percent and France’s CAC 40 advancing 0.78 percent. In Asia, Japan’s Nikkei closed 2.33 percent higher while Hong Kong’s Hang Seng slipped 0.13 percent.
Oil prices fell after President Donald Trump downplayed the likelihood of renewed strikes on Iran, though recent attacks on ships near the Strait of Hormuz kept supply concerns alive. Brent crude dropped 3.48 percent to US$94.90 a barrel and West Texas Intermediate fell 2.83 percent to US$88.26.
"The market appears to be pricing in a relatively optimistic scenario of de-escalation, even though a comprehensive agreement between Washington and Tehran has yet to materialize," said Sugandha Sachdeva, founder of New Delhi-based research firm SS WealthStreet. "Unless there is a meaningful diplomatic breakthrough accompanied by a sustained normalization of shipping flows through the Strait of Hormuz, crude oil prices are likely to retain a geopolitical risk premium, with near-term support seen at US$93 a barrel for Brent."
Spot gold rose 0.9 percent to US$4,102.25 an ounce, and U.S. gold futures for December delivery gained the same margin. The Canadian dollar strengthened, trading at $1.4095 per U.S. dollar, while the U.S. dollar index slipped 0.44 percent to 107.85. The euro rose 0.39 percent to US$1.1188 and the British pound advanced 0.44 percent to US$1.3412. U.S. 10-year Treasury yields fell to 4.861 percent.
Upcoming data includes China’s consumer price index and producer prices, Germany’s trade surplus, U.S. wholesale inventories for September, and the Bank of Canada’s Market Participants Survey for the third quarter.