The Canadian stock market ended on a negative note on Wednesday, with the benchmark S&P/TSX composite finishing below the 18,000-level as weakness among the heavyweight materials sector offset gains in healthcare. Investors remained cautious ahead of the upcoming corporate earnings season, while a worsening pandemic also weighed on sentiment. Alimentation Couche-Tard was the worst-performing stock in the TSX, down more than 10% after recently submitted a non-binding offer letter to Carrefour.

Wall Street closed little changed on Wednesday, as sliding interest rates offset rising coronavirus deaths and political uncertainty. Tech shares were nudged higher by Intel, up nearly 8% on news that CEO Bob Swan would step down effective February 15. On the policy side, the House of Representatives plans to vote on Wednesday to impeach Trump for a second time. Investors also looked to the unveiling of President-Elect Biden’s stimulus plan expected for Thursday. On the pandemic side, the US recorded on average 247,600 new cases and 3340 new deaths in the last 7 days, reaching new highs. The Dow Jones lost 8 points or less than 0.1% to 31,061. In contrast, the S&P 500 added 9 points or 0.2% to 3910, while the Nasdaq climbed 57 points or 0.4% to 13,129. .

The US posted a budget deficit of USD 144 billion in December 2020, compared with a USD 13.3 billion gap in the same period last year. Outlays were recorded at USD 490 billion, while receipts fell to USD 346 billion. For the first three months of the 2021 fiscal year started October 1st, the US federal deficit stood at USD 573 billion, compared with USD 357 billion in the same period of fiscal 2020, amid efforts to support the economy hit by the coronavirus crisis. Outlays increased to USD 1376 billion due to spending on healthcare and coronavirus rescue programs and on unemployment compensation, while receipts declined to USD 803 billion.

Oil prices retreated from multi-month highs on Wednesday, with WTI crude falling below the $53 level amid persistent demand concerns due to the coronavirus pandemic. The imposition of tighter and extended lockdowns, particularly in Europe, where a new strain of coronavirus is rapidly circulating, clouded the outlook on fuel demand recovery. Putting a floor under prices were Saudi Arabia's pledges to limit supply, a larger-than-expected decline in US crude inventories and prospects of more economic stimulus spending in the United States to aid the coronavirus-battered economy.

European stocks ended slightly higher on Wednesday, with Frankfurt's DAX 30 gaining 0.3% at 13,960, as investors awaited the accounts of the ECB monetary policy meeting due tomorrow and details on a massive package of fiscal stimulus to be delivered in the US. At the same time, worries about rising coronavirus infections and new restrictive measures continued, amid efforts to speed up vaccination across the continent. The Netherlands extended lockdown to February 9th and Chancellor Angela Merkel warned Germany may need 8 to 10 weeks of lockdown extension.

New Zealand's main stock index opened higher on Wednesday, with the benchmark S&P/NZX 50 rising towards the 13,200-level driven by a rally in healthcare shares, while positive vaccine news added to the optimism. Johnson & Johnson’s one-dose coronavirus vaccine is safe and showed a positive immune response in an early trial. Synlait Milk Ltd and Sanford Ltd were among the biggest gainers on the index, up more than 2%.

Brazil's Ibovespa shed 2065 points or 1.7% to 121,933 on Wednesday, as the departure of Ford Motor Company from the country and fiscal uncertainty in the US weighed on sentiment. On the corporate side, shares mining companies Vale, Usiminas and Gerdau were among the worst performers due to a fall in iron ore prices in China. On the pandemic front, the Covid-19 vaccine developed by China’s Sinovac Biotech was found to be just 50.4% effective at preventing symptomatic infections of COVID-19 in a Brazilian trial, barely enough for regulatory approval and well below the rate of 78% announced last week.

The Chilean peso touched 745.5 against the USD on Wednesday, its lowest level since December 7th, after the central bank announced plans to boost its international reserves. The Central Bank of Chile said it will start to replenish its reserves next week through daily purchases of $40 million at competitive auctions of a total value of $12 billion. The move aims to strengthen liquidity as the IMF credit line will end next year. With this increase, reserves will total 18% of the GDP. The Chilean peso appreciated around 5.6% against the greenback in 2020, mainly supported by copper prices.

The industrial product price index in Canada rose 1.4% month-over-month in December of 2020, following a 0.6% drop in the previous month, preliminary estimates showed. It was the first increase in industrial prices following two months of decline, driven by higher prices for lumber and other wood products (+10.8%), particularly softwood lumber (+21.7%). Additional upward pressure came from costs of energy and petroleum products (+7.9%), particularly refined petroleum energy products (+9.2%) such as diesel and biodiesel fuels (+10.1%) and motor gasoline (+7.7%). Prices also went up for primary non-ferrous metal products (+3.1%), on higher prices for unwrought aluminum and aluminum alloys (+8.1%) and unwrought copper and copper alloys (+7.6%). Prices for chemicals and chemical products (+2.2%) also increased. Year-on-year, producer prices rose up 1.5%.