Bay Street May Open Higher; Earnings, Inflation Data In Focus

(RTTNews) - Canadian shares may open higher Tuesday morning as resources stocks are likely to find support thanks to rising commodity prices. The focus will be earnings, and key economic data from Canada and the U.S.

Data on Canadian producer and raw materials prices for the month of April is due at 8:30 AM ET.

In Canadian earnings news, Bank of Nova Scotia (BNS.TO) reported second-quarter net income of $2,092 million, or $1.57 per diluted share, compared to $2,146 million, or $1.68 per diluted share, in the second quarter of the previous year.

The Canadian market ended on a slightly positive note on Monday, led by gains in materials sector as metal prices surged higher amid optimism about interest rate cuts by some major central banks.

With the U.S. market closed for Memorial Day holiday, and some crucial economic data due later in the week, the mood remained a bit cautious, and the volume of business was somewhat thin.

The benchmark S&P/TSX Composite Index ended with a gain of 52.51 points or 0.24% at 22,373.38, after moving in a tight range between 22,337.32 and 22,388.91.

Asian stocks fluctuated before closing lower on Tuesday as investors remained focused on upcoming U.S. and European inflation data for additional clues on the path of interest rates.

The dollar extended weakness to hit a one-week low as market participants awaited the U.S. PCE price index report due later this week as well as speeches from Fed officials including Mester, Bowman, Kashkari, Cook and Daly for more clarity on the path for Federal Reserve monetary policy.

Traders also looked ahead to the release of German and Eurozone inflation figures this week that could cement expectations for an ECB rate cut next week. European stocks are weak with investors digesting the data , and awaiting inflation readings from the U.S. for directional clues.

In commodities, West Texas Intermediate Crude oil futures are up $1.14 or 1.47% at $78.86 a barrel.

Gold futures are gaining $12.50 or 0.54% at $2,347.00 an ounce, while Silver futures are up $1.301 or 4.27% at $31.800 an ounce.