Canadian shares look headed for a weak start Wednesday morning with some hawkish comments from Fed officials raising concerns about the outlook for interest rate. Weak metal prices are likely to weigh as well.
Investors are likely to react to quarterly earnings updates from Bank of Montreal (BMO.TO) and National Bank of Canada (NA.TO).
Bank of Montreal reported that its second-quarter net income grew to C$1.87 billion from last year\'s C$1.03 billion. Earnings per share were C$2.36, compared to C$1.26 a year ago. Adjusted net income was C$2.03 billion or C$2.59 per share, compared to prior year\'s C$2.19 billion or C$2.89 per share.
National Bank of Canada reported net income of C$906 million or C$2.54 per share for the second quarter, higher than C$832 million or C$2.34 per share in the same quarter a year ago, primarily helped by growth in revenue in all segments.
The Canadian market ended on a weak note on Tuesday after languishing in negative territory right through the day\'s session as investors awaited some crucial economic data, including a reading of U.S. inflation, for clues about the outlook for interest rates.
The benchmark S&P/TSX Composite Index ended down by 108.33 points or 0.48% at 22,265.05, nearly 60 points off the day\'s low of 22,209.30.
Asian stocks ended mostly lower on Wednesday as the dollar and U.S. bond yields ticked higher following hawkish Fed comments and disappointing two-year and five-year note auctions.
Geopolitical tensions also weighed on the markets after the pro-Iranian Yemeni Houthi group attacked a Greek ship in the Red Sea.
European stocks traded slightly lower on Wednesday as higher bond yields and a surge in oil prices due to heightened tensions in the Middle East stoked concerns that interest rates will likely stay higher for longer.
In commodities, West Texas Intermediate Crude oil futures are up $0.58 or 0.73% at $80.41 a barrel.
Gold futures are down $14.90 or 0.63% at $2,341.60 an ounce, while Silver futures are lower by $0.022 or 0.07% at $32.115 an ounce.