12:12 PM EDT, 10/01/2024 (MT Newswires) -- The Toronto Stock Exchange is down 8 points at midday, with info tech, down 1.6%, the biggest decliner.

Energy, up 2.5%, is the biggest gainer.

Oil prices were down early on Tuesday as weak demand continues to weigh on the market ahead of tomorrow's OPEC+ meeting that is expected to confirm plans to gradually return 2.2-million barrels per day of voluntary production by adding 180,000 bpd of output monthly beginning in December.

But gold prices rose as treasury yields narrowed after Federal Reserve Chair Jerome Powell indicated the central bank is unlikely to repeat last month's 50 basis point cut to interest rates and instead will opt for more gradual cuts.

BMO in its morning note, said it's "eerily quiet" in Canada this week, with no major market-moving data releases on deck

BMO noted equity markets pointed to a flat open this morning, but it also noted Canadian stocks have been on a bit of a run of late. It said the TSX has, in fact, outperformed the S&P 500 by a "decent margin" over the past three months, now roughly 10% versus 5% south of the border. BMO added that while there has been some weakness in the heavyweight energy sector alongside softer oil prices, that has been more than offset by double-digit gains across utilities, financials and REITs. It also noted dividend yields across much of this group, which looked "just fine" when 10-year GoC yields were hovering around 4% a year ago, now look "downright juicy" with that yield below 3% and the Bank of Canada easing quickly.

Indeed, BMO said, last week's GDP data confirm that the early phase of this easing cycle will be brisk, with a 50-bp October rate cut fully on the table. It noted Canadian yields were little changed last week, and the 10-year sat at 2.95% this morning. With the 5-year now down to 2.72%, look for further downward pull on fixed mortgage rates in the coming months unless something materially changes in the interest rate outlook, the bank added.

Meanwhile, Scotiabank noted in the U.S. there is more Fed-speak on tap today along with modest US data risk. Bostic was due to speak (11am ET) alongside Governor Cook (at 11:10am ET) and then Bostic reappears along with Richmond's Barkin and Boston's Collins on a panel (6:15pm ET).

Thierry Wizman, Global FX & Rates Strategist at Macquarie, said he wasn't surprised by Jay Powell's reluctance to endorse a 50bp cut to the US's Fed Funds Rate target in November. Wizman noted although Powell cited slower hiring and broad disinflation, he didn't see a need to rush, either. Even before Powell's discourse, the OIS-implied probability of a 50bp rate cut had moved from roughly 50%, to about 30%, he also noted.