Futures tracking Canada's main stock index fell over 1% on Wednesday as their U.S. peers declined, with investors focusing on a flurry of U.S. economic data to gauge where the Federal Reserve stands on monetary policy tightening.
The TSX gained 105.26 points, off its highs of the day, to close Tuesday at 19,694.16.
March futures on the S&P/TSX index trudged lower 1.7% Wednesday morning.
The Canadian dollar removed 0.3 cents to 72.75 cents U.S.
On the research front, Scotiabank raised Canadian Pacific Railway’s rating to "sector outperform" from "sector perform".
Investors would also lookout for fourth-quarter earnings from Jaguar Mining and Nexus Industrial REIT before markets open.
On the economic calendar, Canada Mortgage and Housing Corporation says the trend in housing starts was 255,735 units in February 2023, down from 259,830 units in January, while the Canadian Real Estate Association revealed national home sales rose 2.3% month-over-month in February. Actual (not seasonally adjusted) monthly activity came in 40% below February 2022.
ON BAYSTREET
The TSX Venture Exchange recovered 3.17 points Tuesday to 611.03.
ON WALLSTREET
Stock futures fell on Wednesday as pressure on the financial sector increased with shares of Credit Suisse, a Swiss Bank that has large U.S. and global operations, tumbling more than 20%.
Futures for the Dow Jones Industrials fell 543 points, or 1.7%, early Wednesday to 31,859.
Futures for the S&P 500 dipped 68 points, or 1.7%, to 3,886.25.
Futures for the NASDAQ Composite gave way 171.5 points, or 1.4%, to 12,165.50.
In recent days, a crisis in the financial sector has centered around regional banks as Silicon Valley Bank and Signature Bank collapsed, both casualties of poor management in the face of eight interest rate hikes by the Federal Reserve in the last 12 months. Wednesday morning attention turned to the big banks with shares of Credit Suisse hitting an all-time low.
Saudi National Bank, Credit Suisse’s largest investor, said Wednesday it could not provide any more funding, according to a Reuters report. This comes after the Swiss lender said earlier this week it had found “certain material weaknesses in our internal control over financial reporting” for the years 2021 and 2022.
At last check, U.S.-traded shares of Credit Suisse were down 20.7% in the premarket.
As Credit Suisse dragged down the European Bank sector, U.S. big bank shares declined in sympathy. Citigroup and Wells Fargo shed 3% each, while Goldman Sachs and Bank of America fell 2% apiece. The Financial Select Sector SPDR Fund lost 2.9% in premarket trading, giving up its 2% pop on Tuesday.
Regional banks, which rebounded Tuesday to lift sentiment for the broader market, fell back into the red again, led by losses in Old National Bancorp, Zions Bancorp and Fifth Third Bancorp. To be sure, shares of First Republic Bank were clinging to gains.
In Japan, the Nikkei 225 index recovered nearly eight points Wednesday, while in Hong Kong, the Hang Seng jumped 1.5%.
Oil prices fell 94 cents to $70.39 U.S. a barrel.
Gold prices hiked $10.90 to $1,921.80 U.S. an ounce.
