Global markets were upbeat after the U.S. Federal Reserve delivered its first interest rate cut this year. But Fed chair Jerome Powell also signalled a measured approach to further monetary policy easing, leaving investors unsure about the pace of future moves.

Wall Street futures were in positive territory after major U.S. markets had a mixed close yesterday.

TSX futures followed sentiment higher after the Bank of Canada also cut its key rate.

On Wall Street, markets are watching earnings from FedEx Corp., Lennar Corp. and Darden Restaurants Inc.

“Resuming a rate cut cycle at this stage is fraught with risks, which was underscored by Chair Powell in his press statement,” Taimur Baig, chief economist at DBS said in a note. “He conceded that it is not obvious what to do at this juncture.”

Overseas, the pan-European STOXX 600 was up 0.72 per cent in morning trading. Britain’s FTSE 100 rose 0.2 per cent, Germany’s DAX climbed 1.22 per cent and France’s CAC 40 advanced 1.15 per cent.

In Asia, Japan’s Nikkei closed 1.15 per cent higher, while Hong Kong’s Hang Seng fell 1.65 per cent from the previous session’s four-year high.

Oil prices declined for a second session after the Fed cut rates as expected and traders focused on concerns about the U.S. economy and excess supplies.

Brent crude futures fell 0.4 per cent to US$67.65 a barrel. West Texas Intermediate futures dropped 0.5 per cent to US$63.75.

“What caught markets’ attention was not just the easing, but Powell’s downbeat message,” said Priyanka Sachdeva, a senior market analyst at Phillip Nova.

“He stressed weakening job markets and inflation that remains sticky, making the cut look more like risk-management than a demand booster.”

In other commodities, spot gold slipped 0.1 per cent to US$3,657.21 an ounce. U.S. gold futures for December delivery dropped 0.7 per cent to US$3,691.00.

The Canadian dollar strengthened against its U.S. counterpart.

The day range on the loonie was 72.46 US cents to 72.65 US cents in early trading. The Canadian dollar was up about 1.02 per cent against the greenback over the past month.

The U.S. dollar index, which weighs the greenback against a group of currencies, advanced 0.05 per cent to 96.92.

The euro gained 0.16 per cent to US$1.1834. The British pound rose 0.13 per cent to US$1.3644.

In bonds, the yield on the U.S. 10-year note was last down at 4.056 per cent.

Japan core machine orders

Bank of England monetary policy announcement

(8:30 a.m. ET) Canadian household and mortgage credit for July.

(8:30 a.m. ET) U.S. initial jobless claims for week of Sept. 13. Estimate is 245,000, down 18,000 from the previous week.

(8:30 a.m. ET) U.S. Philadelphia Fed Index for September.

(10 a.m. ET) U.S. leading indicator for August.

With Reuters and The Canadian Press