Evening Money :) September 23
Oil is finally giving markets some breathing room. Brent has fallen for six straight sessions and is hovering around US$99 as Saudi supply returns and hopes grow for progress in U.S.–Iran talks. For Canadians, cheaper oil is a mixed bag: it can weigh on energy stocks, but it also takes some pressure off gasoline prices, inflation and ultimately interest rates.
Markets this morning: TSX futures are down about 0.2% as gold and silver retreat. U.S. futures are roughly flat, while technology remains a bright spot after the Nasdaq hit another record this week. Gold is down close to 1% and silver more than 2% as the U.S. dollar strengthens.
The loonie remains under pressure after touching a nearly seven-week low yesterday. The main culprit is the widening gap between U.S. and Canadian interest rates: the Fed is sounding increasingly willing to hike again if inflation stays stubborn, while Canada is dealing with a softer growth outlook.
What to watch: Middle East diplomacy remains the biggest wildcard for oil. Also keep an eye on Canadian retail sales later this week — an important read on whether consumers are holding up as higher rates and trade uncertainty bite.
