As companies face the possibility of higher borrowing costs, investors aren’t willing to take the risk. US Treasury bonds have pushed past three per cent, the highest in four years, which is stoking concerns the interest rate globally, will grow.
This is taking the hype out of big business earning reports. Google-owner Alphabet saw a drop in shares despite better than expected earnings because investors were looking to the growing company costs. Caterpillar has also warned its costs will likely go up with a rise in metal prices, which weighted the company’s shares.
Traders are waiting to see how shares will be impacted when Facebook releases its own earnings report today. Analysts are expecting to see a reflection of the public criticism Facebook has come under, following the Cambridge Analytica scandal.
The oil price rally has stalled as US production starts growing once again, the price of crude is steady at 67.64. This has weighted the Loonie, which is dropping to 77.64 cents US.