TSX futures slip with higher U.S. tariffs due to take effect in coming days

Investing.com - Futures linked to Canada’s main stock exchange pointed lower on Monday, as investors eyed a looming increase to U.S. import tariffs on its northern neighbor.

By 06:53 ET (10:53 GMT), the S&P/TSX 60 index standard futures contract had fallen by 17 points, or 1.0%.

On Friday, Toronto Stock Exchange’s S&P/TSX composite index sank by 0.9%, its sharpest decline since April 10 and an extension to a recent retreat from record highs. The TSX fell by 1.7% for the week.

The fall mirrored a similar sell-off on Wall Street, with investor sentiment pulled down by the prospect of elevated U.S. levies on a host of nations and a soft employment report for July.

The swath of higher levies President Donald Trump unveiled last week are set to come into effect on August 7. Among the slate of tariffs was a 39% levy on Switzerland as well as a 25% duty on India and 20% on Vietnam.

However, these countries can still negotiate a new trade pact with Washington before the deadline arrives.

Markets may be keeping close tabs on potential talks between Trump and Canadian Prime Minister Mark Carney, in particular. Canada now faces a 35% import duty on its goods not covered by the U.S.-Mexico-Canada Agreement, a trade deal signed during Trump’s first term in office.

A Canadian official told CBS News over the weekend Trump and Carney will speak "over the next number of days," adding that a truce to bring down the tariffs remains on the table.

U.S. futures rise

U.S. stock futures rose, rebounding following the payrolls-inspired sell-off at the end of the prior week, with investors buoyed by the prospect of lower interest rates.

At 06:49 ET (10:49 GMT), Dow Jones Futures gained 252 points, or 0.6%, S&P 500 Futures rose 39 points, or 0.6%, and Nasdaq 100 Futures climbed 177 points, or 0.8%.

The main averages on Wall Street sank on Friday, with the benchmark S&P 500 registering its worst day in more than two months, after Trump signed an executive order imposing steep tariffs on imports from dozens of countries.

The weak jobs report, which featured heavy downward revisions, also weighed on sentiment, as did Trump’s dismissal of the head of the statistics bureau charged with compiling the jobs data, arguing -- without evidence -- that the numbers were "rigged." Analysts flagged that the firing casts doubt over the longstanding reliability of U.S. economic data.

Weak jobs data lifts rate cut hopes

This week, the U.S. economic data calendar centers largely around factory orders for June, amid worries about the health of the U.S. economy after the U.S. Labor Department reported on Friday that nonfarm payrolls rose by only 73,000 in July.

This was well below the expected 110,000, and May and June figures were also revised downward by a combined 258,000 jobs.

Investors viewed this slowdown as a clear signal that the labor market is cooling, prompting the odds of a Federal Reserve rate cut in September to surge to over 80%.

AMD, Caterpillar , Disney earnings awaited

Looking ahead, attention shifts to a packed earnings calendar. More than 150 companies are set to report this week, including major names across tech, industrials, and consumer sectors.

The corporate earnings season has been largely solid so far, which has helped to underline the staying power of a multi-year boom in enthusiasm around the applications of artificial intelligence.

On Tuesday, Advanced Micro Devices (AMD) (NASDAQ:AMD) and Caterpillar (NYSE:CAT) will report, with investors watching for insight into semiconductor demand and global industrial activity.

Wednesday will bring results from Walt Disney (NYSE:DIS), McDonald’s (NYSE:MCD), and Uber Technologies (NYSE:UBER).

Elsewhere, Berkshire Hathaway (NYSE:BRKb) has posted a $3.76 billion write-down on its stake in consumer food company Kraft Heinz (NASDAQ:KHC), while a fall in insurance underwriting premiums also dented second-quarter returns from Warren Buffett’s sprawling conglomerate.

Crude falls on additional OPEC+ supply

Crude prices fell Monday, after a group of top producers agreed to another large production hike in September, adding to global supply.

At 06:49 ET, Brent futures slipped 1.6% to $68.51 a barrel, and U.S. West Texas Intermediate crude futures fell 1.6% to $66.23 a barrel.

The Organization of the Petroleum Exporting Countries and their allies, known as OPEC+, agreed on Sunday to raise oil production by 547,000 barrels per day for September.

The move, in line with market expectations, marks a full and early reversal of OPEC+’s largest tranche of output cuts, amounting to about 2.5 million bpd, or about 2.4% of world demand.

Spot gold price dips

Gold prices were mixed in early European trading on Monday after a sharp rise in the previous session, as investors booked some profits following a rise in the prior session fueled by expectations for Fed interest rate cuts.

Spot gold had fallen 0.4% to $3,358.74 an ounce, while gold futures for December gained 0.3% to $3,411.50/oz by 07:01 ET.

Gold prices jumped over 2% on Friday, after the weak jobs data sparked hopes for a Fed rate reduction in September. The rally in the yellow metal, which tends to do well in a lower-rate environment, helped it post a weekly gain after two straight weeks of declines.