Canada's TSX stock index futures decline as bank earnings reports and gold fall become the focus

Investing.com - On Tuesday, futures linked to Canada’s main stock indexes edged lower as investors closely monitor market unrest triggered by artificial intelligence, uncertainties surrounding U.S. new global tariffs, and the latest earnings reports from domestic banks.

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As of 06:48 AM Eastern Time (19:48 Beijing Time), the S&P/TSX 60 index standard futures contract fell by 4 points, or 0.2%.

On Monday, the S&P/TSX Composite Index declined 0.1% to 33,776.50, retreating from its intraday record high.

Software stocks were hit, with markets continuing to worry about the disruptive impact of powerful AI models. Financial stocks also lagged, as traders expect profits for Canadian lenders to be affected by slowing loan growth and weak consumer demand.

However, gains in the materials sector, including metals mining stocks, offset some of these pressures. This rally was partly driven by rising gold prices.

U.S. Futures Rise

U.S. stock index futures rose modestly, rebounding after a sell-off the previous trading day, as investors digest ongoing global trade uncertainties and concerns over AI disruption, while awaiting key earnings from Nvidia.

As of 07:04 AM Eastern Time, Dow futures increased by 135 points, or 0.3%, S&P 500 futures rose by 16 points, or 0.2%, and Nasdaq 100 futures gained 111 points, or 0.5%.

Major Wall Street indexes fell sharply the previous day, weighed down by ongoing fears that new AI models could disrupt multiple companies.

The Dow Jones Industrial Average closed down 1.7%, the tech-heavy Nasdaq Composite fell 1.1%, and the benchmark S&P 500 declined about 1%, turning its year-to-date gains negative.

These declines followed a report from Citrini Research, which presented a grim hypothetical scenario: that AI could trigger large-scale layoffs among white-collar workers in the coming years, weakening consumer spending, leading to loan defaults, and ultimately causing an economic contraction.

Trade Uncertainty; FedEx Sues Over Tariff Refunds

After the Supreme Court last week overturned former President Donald Trump’s so-called “reciprocal” tariffs, new global trade tariffs took effect Tuesday at 10%, with markets remaining concerned about the future of global trade.

This 10% rate was communicated via the U.S. Customs and Border Protection’s news service, lower than the 15% tariffs Trump announced over the weekend. However, Bloomberg reports that the White House is drafting an official order to raise the rate to 15%.

Given the uncertain outlook for Trump’s trade agenda, the future of specific agreements with multiple trading partners remains unclear. Some countries are reportedly reassessing whether these agreements are still valid after the Supreme Court ruling. In response, Trump warned on social media not to “play games” with these deals.

Adding to the overall uncertainty, FedEx (NYSE: FDX) filed a lawsuit Monday seeking a “full refund” of emergency tariffs paid over the past year.

FedEx is the first company to seek a refund following the Supreme Court decision and joins a large group of companies challenging Trump’s tariffs legally.

The ruling leaves unclear how to handle the revenue collected from Trump’s illegal tariffs, estimated to exceed $160 billion.

Home Depot Leads Earnings Season

Ahead of Nvidia’s (NASDAQ: NVDA) quarterly report scheduled for Wednesday, market sentiment toward tech stocks remains weak. The world’s most valuable company is widely seen as a barometer for AI demand and is expected to report strong profit growth compared to last year.

Additionally, Reuters reports that Paramount Skydance (NASDAQ: PSKY) has increased its bid for Warner Bros Discovery (NASDAQ: WBD), attempting to persuade the HBO Max owner to abandon its deal with Netflix (NASDAQ: NFLX).

Citing sources, Reuters says Paramount’s new offer improves upon its initial bid of $30 per share for Warner Bros, or about $10.84 billion. Meanwhile, Netflix has reached an agreement with Warner on its studio and streaming assets, offering $27.75 per share, or roughly $8.27 billion.

In earnings news, Home Depot (NYSE: HD) will release its latest quarterly results before the market opens.

The home improvement retailer previously issued weak guidance for fiscal 2026, citing sluggish demand for commodities as it grapples with a challenging environment.

Crude Oil Nears Seven-Month Highs

Ahead of a new round of U.S.-Iran nuclear talks later this week, oil prices remain near seven-month highs.

Brent crude futures fell slightly by 0.1% to $71.04 per barrel, while U.S. WTI crude futures were roughly unchanged at $66.30 per barrel.

Both contracts are trading near levels seen since early August 2025.

Iran and the U.S. are scheduled to hold their third round of nuclear negotiations in Geneva on Thursday, as Washington seeks to end Iran’s nuclear program amid rising fears of military conflict.

Gold Declines

Gold prices retreated from a three-week high after four consecutive days of gains, as investors took profits and the dollar strengthened, amid renewed concerns over U.S. trade tariffs.

As of 07:18 AM Eastern Time, spot gold fell 1.5% to $5,152.77 per ounce, after reaching its strongest level since late January earlier in the session. U.S. gold futures declined 1.0% to $5,173.54 per ounce.

The previous day, gold surged 2.5% amid renewed uncertainty over U.S. trade policies.

Additionally, silver prices fell nearly 2% to $86.55 per ounce after four days of gains.