Canadian shares are expected to open on a negative note this Monday, influenced by weak European markets and declining gold prices. Investor sentiment is likely to remain cautious ahead of the Federal Reserve's monetary policy announcement and critical U.S. consumer price inflation data scheduled for later in the week.
While the Federal Reserve is not anticipated to alter interest rates, attention will be centered on the accompanying statement for any hints regarding future monetary policy.
Africa Oil Corp. (AOI.TO) reported that it acquired 994,000 common shares last week under its previously announced buyback program. The company intends to cancel all the repurchased shares.
The Canadian market experienced a significant downturn on Friday, driven by sharp losses in the materials and real estate sectors. Additionally, diminishing expectations of a Federal Reserve rate cut in September, spurred by stronger-than-expected U.S. non-farm payroll employment data, contributed to the decline.
The benchmark S&P/TSX Composite Index fell by 222.10 points, or 1%, closing at 22,007.00, slightly above the day's low of 22,002.68. The index remained in negative territory throughout the session, closing the week with a 1.2% loss.
According to Statistics Canada, employment in Canada rose by 26,700 jobs in May 2024, following a gain of 90,400 jobs in the preceding month and surpassing forecasts of 22,500 jobs.
The unemployment rate in Canada increased to 6.2% in May from 6.1% the previous month, marking the highest level since October 2021.
Asian stocks ended mostly lower in thin trading on Monday, with markets in China, Hong Kong, and Australia closed for public holidays. The U.S. dollar strengthened in international markets as the euro declined sharply amid political instability in France following President Emmanuel Macron's call for an early legislative election.
The major European markets are experiencing significant declines, with French stocks particularly impacted by heavy selling pressure. This follows President Emmanuel Macron's call for snap legislative elections in June, after the European Union elections indicated a broader shift towards right-wing and far-right parties.
In the commodities market, West Texas Intermediate crude oil futures are up by $0.22, or 0.29%, at $75.75 per barrel.
Gold futures are down by $0.70, or 0.3%, at $2,318.00 per ounce, while silver futures are gaining $0.43, or 1.46%, at $29.87 per ounce.
