Canada’s commodity-linked main stock index closed above the 24,000 threshold for the first time on Thursday as China’s assurance of more stimulus offset pressure on energy shares after oil prices tumbled. The S&P 500 also scored a record high, as a surge in Micron Technology shares and a solid U.S. jobless claims report eased concerns about the labour market.
The S&P/TSX composite index ended up 127.95 points, or 0.5%, at 24,033.83, eclipsing the record closing high it posted on Tuesday.
China plans to issue special sovereign bonds worth about 2 trillion yuan (US$284.43 billion) this year as part of a fresh fiscal stimulus, sources told Reuters on Thursday.
“China is obviously a big industrial consumer of things like copper and metals,” said Brian Madden, chief investment officer at First Avenue Investment Counsel. The stimulus is positive “for global economic growth, Chinese economic growth and by extension demand for Canadian resources.”
The materials sector was up 1.5% as gold extended its record-setting run and copper jumped more than 3%. Technology in Toronto rose 2%, tracking gains for Wall Street’s tech-heavy Nasdaq following Micron Technology’s upbeat first-quarter forecast.
Consumer discretionary was also a standout, adding 1.8%, as shares of auto parts supplier Magna International clawed back much of the previous day’s sharp decline. The heavily weighted financials sector was up 0.9%.
Energy fell 3.1%, as the price of oil settled 2.9% lower at US$67.67 a barrel on a report that top exporter Saudi Arabia will give up its US$100 price target in preparation for raising output.
In the U.S. Micron shares closed up 15.7%. Its better-than-expected first-quarter revenue forecast highlighted strong demand for memory chips used in artificial intelligence computing. The broader Philadelphia SE Semiconductor index added 3.77% as most chip stocks rallied.
A string of robust U.S. economic data eased concerns that the Federal Reserve may be cutting rates aggressively to curb any slowdown.
Weekly jobless claims fell more than anticipated, signaling a steady labor market, while the final reading of gross domestic product confirmed that the economy grew 3% in the second quarter.
“It (the GDP number) just kind of reinforces that strong economic growth backdrop that we have been seeing,” said Mike Dickson, head of research at Horizon Investments in Charlotte, North Carolina.
The benchmark S&P 500 closed up 23.11 points, or 0.40%, at 5,745.37, after rising to a record intraday high of 5,767.37.
The blue-chip Dow Jones Industrial Average rose 260.36 points, or 0.62%, to 42,175.11. The Nasdaq Composite advanced 108.09 points, or 0.60%, to 18,190.29.
Seven of the 11 S&P 500 sectors climbed, led by materials, which rose 1.97%.
The S&P 500 and Dow have hit multiple record highs this year, while the tech-heavy Nasdaq is about 2% shy of its own milestone. Market rallies have been driven by optimism surrounding AI and expectations of lower interest rates.
Mining stocks were also sharply higher in the U.S. Thursday. Copper miner Freeport-McMoRan gained 7.45%.
The Russell 2000 index tracking small caps outperformed the broader market with a 0.62% gain.
U.S.-listed Chinese firms such as Li Auto gained 7.13%, PDD Holdings advanced 13.28%, while Alibaba added 10.08%.
Shares of Wells Fargo gained 5.19% after a report showed the banking giant had sent the Fed a review for lifting asset cap restrictions.
Southwest Airlines gained 5.42% after the carrier raised its third-quarter revenue forecast, while Accenture rose 5.57% after the IT services provider forecast annual revenue above estimates.
Advancing issues outnumbered decliners by a 1.94-to-1 ratio on the NYSE. There were 626 new highs and 71 new lows on the NYSE. The S&P 500 posted 50 new 52-week highs and two new lows while the Nasdaq Composite recorded 95 new highs and 94 new lows. Volume on U.S. exchanges was 12.46 billion shares, compared with the 11.82 billion average for the full session over the last 20 trading days.
Reuters, Globe staff