BEFORE THE BELL: US-China tensions, Italy concerns push investors to safe havens; BoC talks interest rate today
Investors, haunted once again by trade war fears, are shifting funds to safer options according to experts. The US has rattled China once again, with renewed threats of trade tariffs, which has earned a warning of trade war retaliation from Chinese officials. This led to a selloff on Wall Street yesterday and sent the Nikkei spiraling down 1.5 per cent to close at 22,018.
Investors are also concerned about the possibility of another Brexit-style upheaval in Europe as Italy could face a summer election with anti-euro parties eyeing power. Analysts say US Treasuries and German Bunds are becoming the safe haven for investor dollars.
The price of oil continues to back down as world producers increase output, but the price of US crude is steady at 66.74 a barrel.
Traders are expecting another drop in the TSX caused by falls in the energy and financial sectors.
Meanwhile, the Bank of Canada will be announcing its position on interest rates at 10am, with analysts suggesting the benchmark will likely remain at 1.25 per cent.