TORONTO – There was little change in the Toronto stock market Monday amid low trading volumes and no guidance from U.S. markets, which were shut for the Memorial Day holiday.
The S&P/TSX composite index faded 18.56 points to 14,086.67, weighed down by declines in metals and energy stocks, with some offset by gains in the consumer staple and consumer discretionary sectors.
With Wall Street being closed for the U.S. holiday, traders turned to a mixed outlook on commodities for some direction.
In electronic trading, the July contract for benchmark North American crude oil was up 27 cents at US$49.60 a barrel.
Oil prices are expected to stay volatile as the Organization of Petroleum Exporting Countries meets Thursday in Vienna, although it’s not expected that an agreement on output will be reached, especially after Iran and Iraq have both suggested that they will continue to increase production.
“At the end of the day, my view is that we have a lot of supply. I don’t think we’re on a straight (price) path higher from here,” said Craig Fehr, a Canadian market strategist at Edward Jones in St. Louis.
“Markets and investors should really start pricing in that we could see a lot more volatility. It could cause oil prices to pull back a little bit.”
Crude supply will continue to grow as more oilsands producers in Alberta resume operations after a massive wildfire in the Fort McMurray area forced them to shut production.
In other commodities, July natural gas slipped a penny to US$2.16 per mmBtu. August gold shed $9.30 to US$1,207.40 a troy ounce and July copper was off two cents at US$2.10 a pound.
The Canadian dollar was also weaker, edging down 0.08 of a U.S. cent to 76.62 cents US.
New York futures indexes moved higher amid greater optimism about the global economy and signs that the U.S. Federal Reserve Fed intends to keep raising interest rates as long as growth keeps improving.
The Dow Jones industrials futures were up 50 points at 17,899, while the broader S&P 500 headed 3.70 points higher to 2,101 and the Nasdaq futures gained 12 points to 4,522.
Last week, Fed chairwoman Janet Yellen indicated that the U.S. central bank is open to hiking rates as early as June at its next meeting, if economic conditions support such a move.
“I think it’s a pretty high probability that we get one (hike), to the extent that the data doesn’t turn back much weaker,” said Fehr.
Fehr said the Fed seems to be trying to be as transparent possible and that “Yellen is carrying on that approach of trying to condition the market for what they’re likely to do lying ahead.”
Follow @LindaNguyenTO on Twitter.