Bay Street Likely To Open Higher On Firm Commodity Prices

(RTTNews) - The Canadian market may open higher Monday morning as some strong buying is likely in energy and materials sectors thanks to rising oil and metal prices.

However, the mood is likely to remain cautious amid persisting worries about tensions in the Middle East.

The Bank of Canada's interest rate decision is due on Wednesday. The central bank is widely expected to reduce its key policy rate by 50 basis points, marking its fourth cut in a row.

The Canadian market climbed to a new record high on Friday, rising for a third straight day, thanks to strong gains in materials stocks as metal prices surged to record highs. Continued optimism about interest rate cuts by the Bank of Canada also aided sentiment.

The benchmark S&P/TSX Composite Index, which marched to a new intra-day high at 24,850.15, settled with a gain of 132.06 points or 0.53% at 24,822.54, a new closing high. The index gained nearly 1.5% in the week.

Asian stocks turned in a mixed performance on Monday as China's central bank once again cut interest rates and the country's banks slashed borrowing costs to combat the country's stubborn economic slump.

Uncertainty over wars in the Middle East and Europe, and uncertainty around the U.S. presidential election weighed on stocks. Israel opened up a fresh military assault on Hezbollah's strongholds in Lebanon, a day after a drone exploded next to Prime Minister Benjamin Netanyahu's private home.

Israel has already vowed to retaliate against Iran for a missile attack at the start of October.

European stocks are notably lower in cautious trade as investors look for directional cues.

ECB policymaker Gediminas Simkus said today that rates could get lower than the natural level between 2% and 3%, if a fall in inflation becomes entrenched.

In commodities, West Texas Intermediate crude oil futures are up $1.48 or 2.14% at $70.70 a barrel.

Gold futures are gaining $19.10 or 0.7% at $2,749.10 an ounce, while Silver futures are up $0.961 or 2.89% at $34.195 an ounce.

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