TSX up after index logs fresh record high close

Investing.com - Canada’s main stock index was higher on Wednesday after a jump in energy stocks powered a climb in the commodity-heavy index to a new record high.

By 12.05 ET, the S&P/TSX 60 index standard futures contract had risen by 5.25 points, or 0.31%.

The S&P/TSX composite index gained 101 points or 0.35% at 29,164.72. 

Index advanced by 0.1% in the prior session to end at 29,063.01, just surpassing an all-time peak logged on Friday.

Energy ticked up by 1.6%, reflecting an increase in crude prices after the Israeli military said it had carried out an attack on Hamas leadership in Qatar.

In individual stocks, Teck Resources shares soared by 11.5%, spurred on by the announcement of a planned merger with Anglo American that would create a copper mining giant.

U.S. stocks mixed

U.S. stocks traded in a mixed fashion, steadying near record highs as investors digested earnings from software group Oracle.

The Dow Jones Industrial Average traded 90 points, or 0.2%, lower, while the S&P 500 index gained 30 points, or 0.5%, and NASDAQ Composite rose 100 points, or 0.5%.

Factory prices falling unexpectedly in August has increased the chances of the Federal Reserve cutting interest rates next week.

The main averages on Wall Street notched gains in the prior session, all recording new closing highs as sentiment remained buoyed by expectations that a Federal Reserve interest rate cut is coming next week.

PPI fell in August

Adding to this positive sentiment, U.S. factory-gate prices unexpectedly fell in August, pointing to easier-than-anticipated inflationary pressures that could bolster the case for the Federal Reserve to slash interest rates at its upcoming policy gathering.

The producer price index decreased by 0.1% last month, according to data from the Bureau of Labor Statistics on Wednesday. Economists had anticipated that the month-on-month figure would climb by 0.3% in August, following a downwardly-revised rise of 0.7% in July.

Investors keep close tabs on the PPI gauge because a section of the data is used to determine a metric of inflation that is preferred by the Fed.

The more widely-watched consumer price index (CPI) is due on Thursday.

Traders now fully see a chance that the Fed will lower rates by at least 25 basis points next week, according to CME’s FedWatch tool. Odds of a more aggressive 50 basis point cut have also risen.

A sharp downward revision to U.S. employment figures for the 12 months through March suggested that a possible cooling in the labor market may have been taking place even before President Donald Trump unveiled sweeping import tariffs in April. Bets that the Fed will slash rates by at least 25 basis points at its September 16-17 gathering were little changed following the numbers, while U.S. Treasury yields, which tend to move inversely to prices, edged higher.

Oracle soars on strong earnings

In the corporate sector, Oracle (NYSE:ORCL) stock jumped more than 28% premarket with investors excited by a bullish artificial intelligence-backed outlook.

The software company said it now expects booked revenue at its Oracle Cloud Infrastructure division to surpass half-a-trillion dollars, a robust forecast which analysts said was a sign of solid demand for the group’s relatively low-cost, AI-powered offerings.

Meanwhile, Apple shares were slightly lower. The tech giant unveiled its iPhone 17 lineup and refreshed Apple Watch and AirPods, including the much-anticipated ultrathin “iPhone Air” model.

Apple’s iPhone 17 Pro will start at $1099, up $100 from the previous pro model, in line with analyst expectations. The group also unveiled a $999 iPhone Air, which replaces the iPhone 16 Plus. The price of Apple’s entry-level iPhone 17 was kept at $799.

Crude gains on heightened tensions

Oil prices rose on heightened geopolitical tensions in the Middle East as well as the prospect of more restrictions on Russian oil potentially denting global supply.

At 12.05 ET, Brent futures gained 2% to $67.71 a barrel, and U.S. West Texas Intermediate crude futures rose 2.14% to $63.97 a barrel.

Prices gained in the previous trading session after Israel said it had attacked Hamas leadership in Doha, which Qatar’s prime minister said threatened to derail peace talks between Hamas and Israel, lifting tensions in the oil-rich region.

Additionally, Reuters reported that Trump is calling on the European Union to steeply tariff India and China over their buying of Russian energy. Trump has already imposed 50% tariffs on India, and was seen calling for 100% tariffs on New Delhi and Beijing.

Despite being designed to pressure Moscow into ending its long-running war with Ukraine, the move could limit global supplies if top buyers India and China cave in to Western pressure. However, both countries have so far signaled few plans to stop their purchases of Russian oil.

Elsewhere, Poland said it had shot down Russian drones flying over its territory during a widespread attack in western Ukraine -- an incursion that the NATO member described as an "act of aggression."

Gold hovers near all-time high

Gold prices rose, holding just below record highs reached in the previous session, as firm expectations of a Federal Reserve rate cut next week boosted demand.

At 12.05 ET, spot gold was slightly up 0.01% to $3,683.20 per ounce, after hitting an all-time peak of $3,674.09/oz on Tuesday.

Year-to-date, gold has surged nearly 40% driven by safe-haven demand due to President Trump’s trade policies and robust central bank demand.

Wagers of a 25-basis point Fed rate cut next week, with a small chance of a 50-basis-point reduction, have also boosted the appetite for bullion. Lower borrowing costs lift gold and metals by reducing the appeal of yield-bearing bonds.

“Monetary policy expectations are now likely to become the primary driver for gold’s direction,” ING analysts said in a recent note.