The Canadian stock market is modestly higher in early trade Thursday. The Canadian sectors are turning in a mixed performance this morning, with gains among financial and energy stocks and losses among gold and information technology names.
Commodity prices are under pressure this morning, due to the strength of the U.S. dollar. The currency has strengthened after the Federal Reserve signaled that another rate hike is likely to occur this year.
The majority of the European markets are trading slightly to the upside Thursday, but remain little changed overall. Traders across the pond are reacting to yesterday's hawkish signals from the Federal Reserve. European banks are in focus due to media reports of a possible merger of Commerzbank with Italy's UniCredit.
Markets in the United States are drifting lower in early trade Thursday. The Fed left interest rates unchanged yesterday, but signaled that another rate hike is likely this year. The Fed's projections pointed to a quarter basis point rate increase later this year, with the rate hike widely expected to come at the December meeting.
The central bank also revealed that it will begin shrinking its $4.5 trillion balance sheet in October, initially allowing $10 billion in bonds to roll off each month.
The benchmark S&P/TSX Composite Index is up 22.12 points or 0.14 percent at 15,411.72.
On Wednesday, the index closed up 96.63 points or 0.63 percent, at 15,389.60. The index scaled an intraday high of 15,392.22 and a low of 15,313.03.
The heavyweight Financial Index is increasing 0.36 percent. Royal Bank of Canada (RY.TO) is rising 0.56 percent and Toronto-Dominion Bank (TD.TO) is adding 0.47 percent. Bank of Nova Scotia (BNS.TO) is climbing 1.03 percent and Bank of Montreal (BMO.TO) is up 0.17 percent. Canadian Imperial Bank of Commerce (CM.TO) is increasing 0.34 percent.
The Capped Industrials Index is up 0.26 percent. Canadian Pacific Railway (CP.TO) is higher by 0.82 percent and Canadian National Railway (CNR.TO) is gaining 0.47 percent. Finning International (FTT.TO) is rising 0.18 percent.
The Energy Index is rising 0.19 percent. Crude oil prices have failed to sustain yesterday's rally but are holding above $50 a barrel Thursday morning. A stronger U.S. dollar in the wake of the Federal Reserve's relatively hawkish policy statement has dented commodity prices.
Crescent Point Energy (CPG.TO) is climbing 2.20 percent and Enbridge (ENB.TO) is adding 0.41 percent. Encana (ECA.TO) is advancing 0.15 percent and Imperial Oil (IMO.TO) is gaining 0.39 percent. Canadian Natural Resources (CNQ.TO) is higher by 0.48 percent and Husky Energy (HSE.TO) is rising 0.66 percent.
The Capped Information Technology Index is losing 0.62 percent. Constellation Software (CSU.TO) is falling 0.07 percent and BlackBerry (BB.TO) is declining 2.14 percent.
The Capped Materials Index is down 0.34 percent. Agnico Eagle Mines (AEM.TO) is falling 0.76 percent and Franco-Nevada (FNV.TO) is declining 0.20 percent.
The Capped Healthcare Index is lower by 0.22 percent. Concordia International (CXR.TO) is dropping 1.97 percent.
The Gold Index is decreasing 0.16 percent. Gold prices are sinking Thursday as the Federal Reserve hinted it will raise interest rates one more time in 2017.
Yesterday, the Fed kept its key interest rate unchanged but maintained their so-called 'dot plot' of rate projections for this year and next, strongly hinting at a December rate hike.
B2Gold (BTO.TO) is weakening by 0.93 percent and Yamana Gold (YRI.TO) is falling 1.20 percent. Goldcorp (G.TO) is declining 0.19 percent and Barrick Gold (ABX.TO) is surrendering 0.66 percent. Kinross Gold (K.TO) is decreasing 2.80 percent and IAMGOLD (IMG.TO) is down 0.39 percent.
The Capped Telecommunication Services Index is down 0.09 percent. Rogers Communications (RCI-B.TO) is losing 0.02 percent and TELUS (T.TO) is falling 0.25 percent.
On the economic front, 536,600 people received regular Employment Insurance benefits in July, up 6,800 (+1.3%) from June. This is the first increase in the number of beneficiaries in eight months.
Wholesale sales rose 1.5% to $62.4 billion in July, following a 0.6% decline in June, Statistics Canada said.
The UK budget deficit decreased to its lowest August level since 2007 on higher sales tax, official data revealed Thursday. Public sector net borrowing excluding interventions decreased by GBP 1.3 billion from the previous year to GBP 5.7 billion in August, the Office for National Statistics reported.
This was the lowest August borrowing since 2007. The deficit was also well below the expected level of GBP 7.1 billion.
First-time claims for U.S. unemployment benefits unexpectedly decreased in the week ended September 16th, according to a report released by the Labor Department on Thursday. The report said initial jobless claims fell to 259,000, a decrease of 23,000 from the previous week's revised level of 282,000.
The continued decrease surprised economists, who had expected jobless claims to climb to 300,000 from the 284,000 originally reported for the previous week.
A report released by the Federal Reserve Bank of Philadelphia on Thursday showed an unexpected improvement in regional manufacturing conditions in the month of September. The Philly Fed said its index for current manufacturing activity rose to 23.8 in September from 18.9 in August, with a positive reading indicating growth. Economists had expected the index to drop to 17.2.
In commodities, crude oil futures for October delivery are down 0.09 or 0.18 percent at $50.60 a barrel.
Natural gas for October is down 0.073 or 2.36 percent at $3.021 per million btu.
Gold futures for December are down 22.20 or 1.60 percent at $1,294.20 an ounce.
Silver for December is down 3.69 or 2.13 percent at $16.965 an ounce.
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