Current Conditions


Toronto stock market dragged down by gold sector, major New York indexes rise

October 14, 2016 - 2:30 PM

TORONTO - Canada's main stock index fell Friday to wrap up the trading week, pulled down by bullion, while markets south of the border gained a little ground.

The S&P/TSX composite index shed 58.72 points to 14,584.99 as stocks in gold lost nearly three per cent of their value.

Other subsectors also declined — stocks in materials dropped 1.54 per cent, health care stocks went down by 0.74 per cent and stocks in energy fell 0.56 per cent

The December gold contract fell $2.10 to US$1,225.50 per troy ounce. The November crude contract slipped nine cents to US$50.35 per barrel.

The decrease in the price of oil is normal volatility, said Craig Jerusalim, a Canadian equities portfolio manager at CIBC Asset Management.

Jerusalim expects crude prices to continue to rise if a recent commitment by the Organization of the Petroleum Exporting Countries to limit oil production turns into action, specifically if Saudi Arabia — one of OPEC's 14 members — stands behind it at the expense of losing its market share.

In the U.S., stock market indexes fared slightly better as traders continue to seek clarity on when the U.S. Federal Reserve would raise interest rates. The central bank has had its interest rate range locked at 0.25 per cent to 0.5 per cent for months.

The Dow Jones industrial average crept up by 39.44 points at 18,138.38. The S&P 500 and the Nasdaq composite both made meagre gains, accumulating 0.43 points to 2,132.98 and 0.83 points to 5,214.16, respectively.

The Canadian dollar closed at 76.07 cents US, up 0.34 of a U.S. cent.

The loonie is probably where it should be relative to the U.S. dollar given the state of both countries' economies, Jerusalim said.

"The Canadian economy is just not as strong as the U.S. economy," he said.

U.S. Federal Reserve Chair Janet Yellen spoke at an economic conference in Boston on Friday. She did not say when the central bank would raise rates, but it is expected to do so in December. Such a move would reflect America's strengthening economy.

The U.S. also released retail sales data Friday that Jerusalim said solidly met expectations. The Commerce Department said spending on restaurants, cars and gas improved in September.

That data further supports the notion of a rate hike in December not rocking the boat too much, Jerusalim said.

Elsewhere in commodities, November natural gas contracts fell 5.6 cents to US$3.285 per mmBtu and December copper contracts slipped 1.15 cents to US$2.11 a pound.

— With files from the Associated Press

Follow @AleksSagan on Twitter.

Note to readers: This is a corrected story. An earlier version incorrectly stated the direction of the stock markets in the first headline and had an incorrect figure for the Canadian dollar.

News from © The Canadian Press, 2016
The Canadian Press

  • Popular vernon News
  • Comments

View Site in: Desktop | Mobile