Bay Street Seen Opening With Positive Bias On Firm Commodity Prices

(RTTNews) - Canadian shares are likely to open with a positive bias on Tuesday, tracking firm crude oil and bullion prices.

Concerns about global economic recession may weigh on sentiment and limit market's upside. The Bank of Japan's surprise policy shift that allows long-term interest rates to rise more is likely to weigh as well.

In company news, Lithium Americas Corp. (LAC.TO) announced a definitive arrangement with Arena Minerals Inc. (TSX.V.TO) to acquire Arena by way of a plan of arrangement in a deal worth $227 million.

Arena's shareholders will receive 0.0226 of a Lithium Americas common share for each Arena Share held, as per the arrangement.

On the economic front, final data on Canadian retail sales for the month of October is due at 8:30 AM ET. Retail sales in Canada likely jumped by 1.5% month-over-month in October of 2022, preliminary estimates showed. On a yearly basis, retail trade rose by 6.9% in September, easing from the 7% jump in the prior month.

Canadian stocks tumbled on Monday, extending recent losses, as fears of a global recession amid surging interest rates continued to weigh on sentiment.

With several central banks, including the Federal Reserve, raising interest rates and signaling further increases in the coming months, traders continued to refrain from creating fresh long positions.

The benchmark S&P/TSX Composite Index ended with a loss of 242.52 points or 1.25% at 19,200.76 after dropping to a low of 19,159.58 intraday.

Asian stocks tumbled on Tuesday and the yen surged against the dollar after the Bank of Japan said it would review its yield curve control policy and widened its target band for interest rates - a move that analysts said would allow long-term interest rates to rise more.

Hawkish comments on interest rates from former Federal Reserve official William Dudley also fueled worries about a worldwide recession.

European stocks are down marginally in early afternoon trades, recovering after a weak start. The BoJ's surprise policy shift that allows long-term interest rates to rise more rattled the markets early on in the session.

In commodities trading, West Texas Intermediate Crude oil futures are up $0.86 or 1.14% at $76.05 a barrel.

Gold futures are gaining $13.00 or 0.72% at $1,810.70 an ounce, while Silver futures are up $0.651 or 2.81% at $23.850 an ounce.