Bay Street Seen Opening Lower On Recession Fears

(RTTNews) - Lower futures and bullion prices, and weakness in European markets due to rising concerns about a recession point to a negative start for Canadian shares on Friday.

The U.S. dollar surged higher and the yield on long term U.S. 10-year Treasury note rose to a new 14-year high of 4.272% after Federal Reserve Bank of Philadelphia President Patrick Harker said on Thursday the central bank will "keep raising rates for a while" to curb inflation.

In Canadian company news, Corus Entertainment Inc. (CJR.B.TO) reported a net loss of $367.1 million ($1.82 loss per share basic) for the fourth quarter ended August 31, 2022, and $245.1 million ($1.19 loss per share basic) for the year, which includes non-cash impairment charges related to goodwill of $350.0 million.

On the economic front, data on Canadian retail sales for the month of August is due at 8:30 AM ET. Retail sales in Canada rose by 0.4% month-over-month in August of 2022, according to preliminary estimates.

After a slightly weak start and a subsequent positive spell that lasted around noon, the Canadian market fell into the red and finally ended moderately lower on Thursday.

Some upbeat earnings news from companies like IBM Corp. and AT&T lifted sentiment early on in the session, but stocks started losing ground as the day progressed as rising bond yields weighed.

Industrials, utilties, consumer discretionary and financials shares closed weak. Energy and technology stocks closed notably higher.

The benchmark S&P/TSX Composite Index ended with a loss of 95.11 points or 0.51% at 18,579.29.

Asian stocks ended broadly lower on Friday as hawkish signals from Federal Reserve officials ramped up fears of a U.S. recession.

European stocks are down sharply amid worries about persistent inflation and the Federal Reserve's aggressive rate-hike cycle.

U.S. 10-year Treasury yields rose to a new 14-year high of 4.272 percent after Philadelphia Fed President Patrick Harker said that the central bank was not done yet with rate hikes.

In commodities trading, West Texas Intermediate Crude oil futures are up $0.28 or 0.33% at $84.79 a barrel.

Gold futures are down $8.90 or 0.54% at $1,627.90 an ounce, while Silver futures are lower by $0.379 or 2.03% at $18.310 an ounce.