Street Calls of the Week
Investing.com - Canada’s main stock exchange ended lower on Wednesday, hovering below the 30,000 mark.
By 4.01 ET, the S&P/TSX 60 index standard futures contract was down by 2.13 points, or 0.12%.
S&P/TSX composite shed 58 points to be at 29,756.95
On Tuesday, Index closed lower by 0.5% at 29,815.63, after having risen above 30,000 for the first time during the session.
The average has rallied throughout the year, rising by over 20% since the start of 2025. It has posted a string of all-time peaks in recent weeks, including a record closing high on Monday.
Sentiment has been bolstered by a Bank of Canada decision to slash interest by 25 basis points last week, as well as a climb in gold prices that has helped to underpin shares of metal miners. The trends have also soothed some worries around Canada’s exposure to sweeping U.S. import tariffs.
S&P, Nasdaq slides
U.S. stocks lost gains to end lower, continuing weakness in the wake of cautious statements from Federal Reserve Chair Jerome Powell and weaker-than-expected business activity data.
At 4:00 p.m ET (20:00 GMT), the Dow Jones Industrial Average fell 171 points, or 0.4%, the S&P 500 index fell 0.3%, and the NASDAQ Composite dropped 0.3%
Stocks steadied after a negative session on Wall Street, snapping a three-session streak of record high closes, as losses in technology stocks weighed.
Investors also remained uncertain over a looming government shutdown, as bipartisan talks over a spending bill appeared to be faltering with about eight days of funding left.
Powell comments prompt caution
Powell warned on Tuesday that the Fed now faces a balancing act with “no risk-free path” as it moves to curb sticky inflation and stem further weakness in the labor market.
Speaking at a luncheon in Warwick, Rhode Island, Powell noted that U.S. economic growth had moderated this year, while the labor market had cooled. He also noted that inflation remained above the Fed’s 2% annual target.
Powell flagged a largely cautious, data-driven approach to future rate cuts, warning that inflation could rise back up if rates were cut too aggressively.
The Fed cut rates by 25 basis points last week, with markets expecting at least two more similar cuts this year. But Powell’s comments dampened expectations of more easing.
Powell also noted that stock prices appeared “fairly highly valued,” sparking some profit-taking after gains in tech put U.S. indices at record highs.
Weaker-than-expected purchasing managers index data for September also sparked concerns over a moderating economy, with growth in both manufacturing and services activity slowing.
GDP, PCE inflation data due this week
Investors are now awaiting more data from the world’s biggest economy, with a final reading on second-quarter gross domestic product growth due on Thursday.
The print had earlier shown the U.S. economy expanding at a strong pace in the second quarter. But this growth is expected to moderate in the coming quarters amid pressure from sticky inflation and higher trade tariffs.
More closely watched this week will be PCE price index data, due on Friday. The print is the Fed’s preferred inflation gauge, and is likely to factor into expectations for future interest rate cuts.
Headline PCE inflation is expected to have remained steady, while core PCE inflation is seen remaining well above the Fed’s 2% annual target.
Micron’s earnings impress
In the corporate sector, shares of Micron Technology moved higher in premarket trading after the memory chip manufacturer posted a fresh quarter of growth fueled by soaring demand from AI developers.
Micron’s latest returns were powered by a stronger-than-anticipated call for its DRAM and NAND offerings, CEO Sanjay Mehrotra said in a post-earnings call.
Alibaba is also likely to be in the spotlight after the Chinese e-commerce giant unveiled its most powerful AI model to date, called Qwen3-Max, and vowed to increase investment in the infrastructure underpinning the nascent technology.
Gold close to record highs
Gold prices steadied, remaining close to recent record highs as the comments from Powell sparked heightened caution over growth, inflation, and interest rates.
Still, hopes for further rate cuts by the Fed before the end of 2025 have bolstered the yellow metal, given that lower rates also make non-yielding assets such as metals appear more attractive. Investors were keeping an eye on upcoming economic data this week, which could provide more insight into the state of inflation and the broader economy.
Heightened geopolitical uncertainty has also burnished bullion’s safe-haven reputation.
Spot gold was mostly flat at $3,762.75 an ounce, while gold futures fell 0.5% to $3,795.20/oz by 06:44 ET.
Oil advances
Oil prices edged higher as a fall in U.S. crude inventories diluted worries about a fall in demand in the world’s largest economy.
Brent futures climbed 1.0% to $68.33 a barrel, and U.S. West Texas Intermediate crude futures rose 1.1% to $64.11 a barrel.
Helping the tone was the news that crude stocks declined by 3.82 million barrels in the week ended September 19, while gasoline inventories fell by 1.05 million barrels, according to data from the American Petroleum Institute figures.
Official U.S. government energy data is due later on Wednesday.