Equity Markets
U.S. stock futures fluctuated while Canadian futures pointed to a positive open amid continuing turbulence in U.S. President Donald Trump's administration and the possibility of a global trade war.
Reports suggested Mr. Trump may remove national security adviser H.R. McMaster, according to a report by the Washington Post. The White House denied the move.
On Thursday, U.S. stocks fell and Canadian stocks ended flat after a report that U.S. Special Counsel Robert Mueller had issued a subpoena for documents, including some concerning Russia, related to U.S. President Donald Trump's businesses offset strong jobs and manufacturing data.
As earnings season has drawn to a close, political developments, such as the ouster of Secretary of State Rex Tillerson this week, have significantly influenced the direction of U.S. stocks. Mr. Trump also recently fired top economic adviser Gary Cohn.
World stocks wavered and the dollar eased on Friday as turmoil in the U.S. administration kept markets watchful at the end of a week scarred by concerns that U.S. tariffs could provoke a trade war.
The MSCI All-Country World index, which tracks 47 countries, was flat after three straight sessions of losses and was set for a weekly fall of around 0.6 per cent.
European shares found some support in dealmaking activity although the STOXX 600 was on track for a 0.2 percent weekly loss. That followed losses in Asia and Wall Street overnight.
"Trump isn't giving markets much respite," said Rabobank analyst Bas van Geffen in a note. "While still vague at best, the subpoena does bring the investigation yet another step closer to the president. Markets certainly didn't like the added uncertainty."
In Europe, Britain's FTSE was up 0.23 per cent, Germany's DAX was up 0.65 per cent and France's CAC gained 0.24 per cent.
In Asia, the Nikkei fell 0.58 per cent, China's Shanghai fell 0.63 per cent and Hong Kong's Hang Seng was off 0.12 per cent.
Commodities
Oil prices were set to fall this week, despite a slight gain in both benchmarks on Friday, on concerns among investors about rising supply from the U.S. and elsewhere threatening to undermine efforts by OPEC and other producers to tighten the market.
Several reports this week renewed investor focus on the potential for rising supply to overwhelm the expected gains in crude demand for 2018.
On Thursday, the International Energy Agency (IEA) said global oil supply increased in February by 700,000 barrels per day (bpd) from a year ago to 97.9 million bpd.
The IEA also said supply from producers outside of the Organization of the Petroleum Exporting Countries (OPEC), led by the United States, would grow by 1.8 million bpd this year versus an increase of 760,000 bpd last year.
The supply increase is more than the IEA's expected demand growth forecast for this year of 1.5 million bpd.
The agency also reported that commercial oil inventories in industrialized nations climbed in January for the first time in seven months.
That directly undermines the efforts of producers led by OPEC and Russia, the world's biggest oil producer, to cut supply to reduce global stockpiles.
"The fact that the inventories rose despite intensifying output curbs led by OPEC shows how much non-OPEC supply has risen," said Tomomichi Akuta, senior economist at Mitsubishi UFJ Research and Consulting in Tokyo.
"Crude prices have been checked by the increase in U.S. supply."
OPEC and other producers began cutting supply in January 2017 to erase a global crude glut that had built up since 2014.
Gold prices edged higher on Friday, supported by a weaker dollar and safe-haven demand amid U.S. political concerns and tensions between the United Kingdom and Russia.
However, further gains were capped by expectations that the U.S. Federal Reserve would raise interest rates at its policy meeting next week.
"As choppier markets seem likely, gold will remain a good hedge against unexpected spikes in equity market volatility and geopolitical tensions, in our view," UBS analysts said in a note.
The Fed will begin its two-day rate-setting meeting on March 20, at which the U.S. central bank is expected to raise interest rates for the first time this year.
"Investors are starting to focus on next week's Fed meeting, which should be constructive for the dollar and bearish for gold," said INTL FCStone.
Gold is highly sensitive to rising U.S. interest rates, because it becomes less attractive to investors since it does not bear interest.
Meanwhile, silver rose 0.5 per cent to US$16.45 an ounce. Platinum edged up 0.1 per cent to US$955.40, while palladium climbed 0.1 per cent to US$987.00.
Currencies and bonds
The Canadian dollar fell Friday, falling closer to the 76 US cent level.
In currency markets, reports of the possible removal of U.S. security adviser McMaster weighed on the U.S. dollar, sending it to its lowest level against the yen since early March. The euro traded up 0.22 per cent at $1.2330, having slipped 0.5 per cent the previous day.
The dollar index, which measures the greenback against a basket of six other major currencies, was down 0.25 per cent at 89.912, easing after two days following remarks from incoming White House economic adviser Larry Kudlow who said he would like the dollar to be stronger.
U.S. Treasuries yields dipped to 2.815 per cent after having hit a near two-week low of 2.797 per cent on Thursday. The two-year yield steadied after hitting a 9 1/2-year high of 2.295 per cent as investors prepared for a widely expected interest rate increase by the Federal Reserve next week.
The Canada 10-year bond yield was down slightly at 2.137 per cent.
Stocks set to see action
Calling its turnaround "historic," BlackBerry Ltd. has signed CEO John Chen to a five-year contract extension that could be worth more than US$300-million if the company's shares jump as much as the pay plan anticipates. The new package, like the deal he got when he signed on in 2013, is largely stock-based, so Mr. Chen wins if shareholders do. At the same time, however, only half of the new package depends on BlackBerry stock making any gains at all. The remaining half requires only modest incremental gains once the awards begin kicking in. BlackBerry shares rose in trading Thursday following the announcement and could continue to gain on Friday.
Shares of Element Fleet Management Corp. plummeted Thursday for the second time in five weeks as the struggling Bay Street finance company said it will take a restructuring charge, cut staff and close offices as part of a recovery plan that will take the rest of 2018 to implement.
French cosmetics group L'Oréal said on Friday it was buying Canadian beauty technology company ModiFace, as it looks to roll out more digital services such as virtual make-up tests. It did not disclose financial terms. ModiFace specializes in augmented reality and artificial intelligence applied to the beauty industry, an area L'Oréal and other peers have been developing as their online sales grow and customers increasingly follow cosmetics trends on social media.
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Economic News
(8:30 a.m. ET) Canadian manufacturing sales and new orders for January. Estimate is month-over-month increases of 0.5 per cent and 0.3 per cent, respectively.
(8:30 a.m. ET) Canadian international securities transactions for January.
(8:30 a.m. ET) U.S. housing starts for February. The Street expects an annualized rate decline of 2.7 per cent.
(9:15 a.m. ET) U.S. industrial production for February. Consensus is an increase of 0.3 per cent from January.
(10 a.m. ET) U.S. University of Michigan Consumer Sentiment for March.
(10 a.m. ET) U.S. Job Openings and Labor Turnover Survey (JOLTS) for January.
With files from Reuters and Bloomberg