Markets across the board have gained back any losses from the beginning of the week, as fears around a crisis in China’s property market eased somewhat and as the Federal Reserve kept current monetary stimulus in place for just a little bit longer. The Dow is up over 550 points this morning while the TSX is up 74 points, oil and natural gas continue to move higher, West Texas Intermediate is now over $73 USD a barrel adding strength the Canadian dollar.
Canada’s retail sales fell 0.6% to $55.8 billion in July, the third decrease in four months. The decline was primarily driven by lower sales at food and beverage stores (-3.4%) and building material and garden equipment and supplies dealers (-7.3%). In July, much of the country continued to implement reopening measures, which eased restrictions on both retailers and services. Sales decreased in 5 of 11 subsectors, representing 38.7% of retail trade. Core retail sales—which exclude gasoline stations and motor vehicle and parts dealers—decreased 1.3%.In volume terms, retail sales decreased 1.1% in July.
The retail sales seem to have minimum impact on the USDCAD and it would seem that market sentiment is the main driver this morning, the Fed announced yesterday no rate hike but it would bring up its bond tapering sooner. Also, mixed news out of China , one side saying that property developer Evergrande demise is overblown, while the other side has the belief that the Chinese government will only step in as a last resort stemming any ripple effect in financial network.
The Canadian dollar should remain strong to the USD the remainder of the day.
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