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Futures for Canada's main stock index rebounded on Tuesday as Prime Minister Justin Trudeau's victory in the federal election raised hopes his government would keep the stimulus taps open, while higher oil prices were set to lift energy stocks.
The TSX Composite plunged 335.82 points, or 1.6%, to close Monday at 20,154.54.
The Canadian dollar nicked up 0.3 cents to 78.41 cents U.S.
September futures boomed 0.6% Tuesday.
Trudeau hung onto power on Monday, saying he had won a clear mandate to govern although he fell short of his goal for a majority win. The Liberals have pledged a substantial $78 billion in new spending over five years.
Teck Resources cut its forecast for annual refined zinc production on Tuesday, citing an impact on its operations from wildfires in British
JP Morgan raised the price target on Canacol Energy to $8.50 from $5.00
CFRA cuts the rating on Gildan Activewear to hold from buy.
National Bank of Canada starts coverage on Green Impact Partners with outperform rating
On the economic page, Statistics Canada reported its new housing price index rose 0.7% in August, continuing the upward trend that began in May 2020.
The TSX Venture Exchange dropped 32.94 points, or 3.7%, Monday to 853.89
U.S. stock futures bounced on Tuesday as investors bought the dip following the S&P 500's worst day since May.
Futures for the Dow Jones Industrials surged 207 points, or 0.6%, to 34,046.
Futures for the S&P 500 gained 27.25 points, or 0.6%, to 4,375.50
Futures for the NASDAQ Composite Index jumped 101.25 points, or 0.7%, to 15,110.75.
Stocks linked to global growth that led Monday’s selloff were bouncing in pre-market trading Tuesday. Nucor steel was up 1.8% in pre-market trading. Copper miner Freeport-McMoRan added 3%. Chipmakers, banks and energy stocks were also bouncing.
Uber shares jumped 5% after raising its outlook for the third quarter.
Also weighing on markets is the delta variant, which remains a global health threat as the colder months approach and vaccination hesitancy persists among some Americans. Johnson & Johnson said on Tuesday that it’s COVID vaccine booster shot is 94% effective.
FedEx, Adobe, AutoZone and Stich Fix report quarterly earnings on Tuesday.
The Federal Reserve begins its two-day policy meeting on Tuesday and investors are looking for more information from Chairman Jerome Powell about the central bank’s plans to taper its bond buying, specifically when that will happen. Powell said last month that he sees the Fed slowing its $120 billion in monthly purchases at some point this year.
The Fed releases its quarterly economic forecasts, the so-called dot plot, along with the statement on interest rates at 2 p.m. ET Wednesday. Powell will have a press conference after the announcements.
Overseas, in Japan, the Nikkei returned from holiday to dump 2.2%, while in Hong Kong, the Hang Seng index regained 0.5%.
Oil prices recovered 72 cents to $71.01 U.S. a barrel.
Gold prices six dollars to $1,769.30 U.S. a pound.