After hitting new highs last week, Canada’s main stock index dropped from its record peak on Monday. This decline was driven by weaknesses in the real estate and tech sectors, as investors brace for a possible interest rate cut from the Bank of Canada later this week. The central bank is set to announce its monetary policy decision on Wednesday, with a 50-basis-point rate cut expected. This would mark the first major reduction in 15 years, excluding the pandemic period. The likelihood of this major rate cut increased after last week’s lower-than-expected inflation data.
U.S. stocks showed mixed results after a strong performance by the major averages last week, as traders looked forward to the release of significant corporate earnings reports. The continued momentum of the major U.S. indices’ recent gains may hinge on whether companies can surpass expectations this earnings season, which is set to intensify this week.
The Canadian dollar traded for 72.28 cents U.S. compared with 72.41 cents U.S. on Friday.
U.S. crude futures traded $1.10 higher at $70.38 a barrel, and the Brent contract added $0.98 to $74.04 a barrel.
The price of gold was down US$1.56 to US$2,719.90.
In world markets, the Nikkei was down 27.15 points to 38,954.60, the Hang Seng was down 325.65 points to 20,478.46, the FTSE was down 40.01 points to 8,318.24, and the DAX was down 196.18 points to 19,461.19.
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(Top image generated with AI)