By TraderVox.com
Tradervox.com (Dublin) – The investors have embarked on safety search as concerns corporate earnings in the Canada will be lower than expected emerged. The Canadian dollar dropped to the lowest this month against the US dollar as well as the majority of major currencies the crude oil and US stocks fell for the fifth day. Canada exports crude oil to the US and one barrel was going for $84. The drop in Asian stocks and US stocks has led to a decline in the demand for higher yielding currencies as investors seek the safety of the dollar and the yen.
Philippe Denolf, who is a currency strategist at Laurentian Bank of Canada in Montreal said that traders lack something to hang their bullish bets on as the market expect to get disappointing earnings this week. However, he acknowledged that there has been good greenback buying in all markets. According to Philippe, fears about the outlook for the corporate profits have caused the market to snap earlier gains. According to market estimates, the S&P 500 companies’ profits fell by 1.8 percent in the second quarter registering the first decline in almost three years. However, sales are estimated to gain by 2.5 percent.
The Canadian dollar has declined by 2.3 percent in the second quarter versus the greenback as futures on oil plunged 18 percent in the same quarter. This has been associated with the deteriorating Europe debt crisis in Europe which is expected to slow global economic growth. The crude oil futures have declined by 2.5 percent to $83.65 per barrel at Mercantile Exchange Prices leading to a 15 percent decrease this year. The loonie continue to follow crude oil in fluctuation and decline as it is mostly associated with this commodity.
The Canadian dollar dropped by 0.3 percent against the dollar to trade at C$1.0226 at the close of trading in Toronto; this is the lowest level the currency has been since June 29.
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