The markets today

TORONTO (CP) — North American stock markets started the week lower on fading hopes of U.S. interest rate cuts later this month.

The decreases followed a downward movement on Friday after a strong U.S. jobs report suggested that deep cuts weren’t as paramount to support the economy.

That is causing equity markets to recalibrate expectations around what the U.S. Federal Reserve might do with rates at its July meeting, and over the remainder of the year, says Craig Fehr, a Canadian markets strategist with Edward Jones. The S&P/TSX composite index closed down 79.04 points at 16,462.95 after hitting an intraday low of 16,458.47.

In New York, the Dow Jones industrial average was down 115.98 points at 26,806.14 as shares of Apple Inc. fell 2.1 per cent on an analyst downgrade. The S&P 500 index was down 14.46 points at 2,975.95, while the Nasdaq composite was down 63.41 points at 8,098.38. This week’s U.S. inflation data will provide another economic signal, but all eyes will be focused on Federal Reserve chairman Jerome Powell’s congressional testimony on Wednesday, Fehr added. The key energy sector dropped 0.78 per cent, followed closely by telecommunications, materials and industrials. Canadian Natural Resources and Encana Corp. each lost more than two per cent as the price of crude oil decreased with geopolitical concerns over Iran’s nuclear program offset by worry about weakening global demand.

The August crude contract was up 15 cents at US$57.66 per barrel and the August natural gas contract was down 1.5 cents at US$2.40 per mmBTU. Telecommunications dropped with shares of Rogers Communications and several other companies decreasing following service outages. A 4.4-per-cent decrease in shares of Turquoise Hill Resources Ltd. pushed the materials sector lower as metal prices fell and the U.S. dollar rose on the prospect that the Fed might not cut rates.

The August gold contract was down 10 cents at US$1,400 an ounce and the September copper contract was down 0.2 of a cent US$2.66 a pound.

The Canadian dollar traded for an average of 76.45 cents US compared with an average of 76.34 cents US on Friday.