Canada’s main stock index rose to a two-week high on Thursday, with heavily weighted financials and energy among the sectors to make headway in a broad-based move as long-term borrowing costs eased and commodity prices climbed.
The S&P/TSX composite index ended up 148.26 points, or 0.7%, at 21,942.16, its highest closing level since June 12. U.S. stocks were nearly unchanged.
“It’s been a tough few weeks for the TSX, especially in comparison with the S&P,” said Christine Tan, a portfolio manager at SLGI Asset Management Inc. “In the last couple of days, we’ve seen the TSX come back a little bit.”
The Toronto market was still on course to post a monthly decline, with the index down 1.5% since the beginning of June. The S&P 500 has advanced 3.9% over the same period.
“Our managers are really waiting to see what the earnings season looks like and more importantly what guidance sounds like before we really get a good sense where the TSX is headed,” Tan said.
All 10 major sectors on the Toronto market ended higher, including a gain of 1.3% for energy as the price of oil settled 1% higher at US$81.74 a barrel.
Gold also rallied. That helped lift metal mining stocks, with the materials group gaining 0.4%.
Financials added 0.6%, while technology was up 1.4%, helped by a 10.5% gain for the shares of BlackBerry Ltd after the company beat first-quarter revenue estimates.
Bond yields eased as U.S. economic data showed a continued slowdown in activity. That helped boost interest rate sensitive stocks, with real estate adding 1.6% and utilities up 0.7%. The yield on the 10-year U.S. Treasury fell to 4.28% from 4.33% late Wednesday.
Data showed new orders for key U.S.-manufactured capital goods unexpectedly fell in May, while core durable goods orders fell 0.1% versus forecasts for a 0.2% rise, boosting investor beliefs that a weaker economy could prompt the Federal Reserve to cut interest rates in September.
Weekly jobless claims fell to 233,000, missing expectations of 236,000. Further, a final print showed the U.S. economic growth increased more than estimated in the first quarter.
On Wall Street, megacap stocks, such as Alphabet and Meta Platforms, firmed as U.S. Treasury yields slipped, up 0.83% and 1.25%, respectively. Amazon rose 2.19% after hitting US$2 trillion in market value for the first time on Wednesday.
“The market is in a bit of a holding pattern here for the PCE because there hasn’t been a lot of big catalysts,” said Ross Mayfield, investment strategy analyst at Baird, about the release of the monthly personal consumption expenditures (PCE) price index - the Federal Reserve’s preferred inflation gauge - on Friday.
The Dow Jones Industrial Average rose 36.53 points, or 0.09%, to 39,164.33, the S&P 500 gained 5.16 points, or 0.09%, to 5,483.06 and the Nasdaq Composite gained 53.53 points, or 0.30%, to 17,858.68.
In a policy essay, Atlanta Fed President Raphael Bostic said inflation “appears to be narrowing” and that should allow rates cuts later this year, while governor Michelle Bowman reiterated that she is still not ready to support a central bank rate cut with inflation pressures still elevated.
Micron fell 7.11% after an in-line fourth-quarter revenue forecast disappointed investors hoping for more upside from the memory chipmaker’s performance in the artificial intelligence boom.
Nvidia was down 1.90%, continuing its recent turbulent ride.
Walgreens Boots Alliance slumped 22.16% after cutting its 2024 profit forecast and announcing plans to close more underperforming U.S. stores.
Denim maker Levi Strauss tumbled 15.4% after falling short of expectations for second-quarter revenue.
In Toronto stock moves, MDA Space Ltd shares jumped 13.5% after the company was awarded a contract to design and deliver a space robotics system.
Advancing issues outnumbered decliners by a 1.62-to-1 ratio on the NYSE. There were 168 new highs and 78 new lows on the NYSE. The S&P 500 posted 9 new 52-week highs and 2 new lows while the Nasdaq Composite recorded 41 new highs and 118 new lows. Volume on U.S. exchanges was 9.49 billion shares, compared with the 11.74 billion average for the full session over the last 20 trading days.
Reuters, Globe staff