Toronto, U.S. stock markets up in broad-based advance on easing trade fears - InfoNews

Current Conditions

Smoke
23.9°C

Toronto, U.S. stock markets up in broad-based advance on easing trade fears

May 14, 2018 - 1:56 PM

Canada's main stock market index closed up Monday along with U.S. markets amid elevated crude prices and lowering trade dispute fears.

The further easing of trade fears came in part from U.S. President Donald Trump's tweets indicating a willingness to negotiate with China, while oil prices have remained over US$70 a barrel as speculations about disruptions remain high, said Craig Fehr, a Canadian markets strategist with Edward Jones in St. Louis.

"It's two things today. It's easing of concerns of a global trade war, and higher oil prices. I think the two are combining to lift equity markets, not only in Canada but on a global scale."

The potential easing of trade fears with China is a positive sign for better outcomes on other trade negotiations as well, said Fehr.

"If we look back over the last several months, certainly the fears of a global trade war have soured investor sentiment periodically, so any evidence or signals that perhaps there's going to be a softer approach or a more negotiated approach to trade relations and to things like tariffs, I think that's showing up as a positive for investors."

The Toronto Stock Exchange's S&P/TSX composite index closed up 102.29 points at 16,085.61, led by the S&P/TSX capped energy index that rose just over two per cent.

The rise in energy stocks came after another day of climbing oil prices as the June crude contract closed up 26 cents at US$70.96 per barrel. The June natural gas contract was also up three cents at US$2.84 per mmBTU.

The Toronto market has seen steady gains since early April, coming close to erasing a sharp drop in late January and early February. The index's rise comes as Canadian equities play catch-up to a global rally, said Fehr.

"We've seen the Canadian market lag for some time now, so I read this rally that we've seen as partly a bit of catch-up as we see investor sentiment broadly become a bit more positive."

He said a pullback in oil prices wouldn't necessarily mean a big hit to energy stocks.

"We did see crude prices rally quite sharply over the last several months, and the energy stocks didn't keep pace. So I think to an extent, a bit of a pullback in oil prices doesn't have to fully show up in the performance of energy stocks, just given there has been a gap that had developed there."

In New York, the Dow Jones industrial average closed up 68.24 points at 24,889.41. The S&P 500 index ended up 2.41 points at 2,730.13 and the Nasdaq composite index was up 8.43 points at 7,411.32.

The Canadian dollar averaged 78.28 cents US, up 0.03 of a US cent.

The June gold contract closed down $2.50 at US$1,318.20 an ounce and the July copper contract ended down two cents at US$3.09 a pound.

Aurora Cannabis Inc. saw its share price drop 17 cents or 2.11 per cent to $7.90 after it announced a $3.2-billion all-stock offer for rival licensed marijuana producer MedReleaf to create what the company says will be the "undisputed world leader in cannabis."

News from © The Canadian Press, 2018
The Canadian Press

  • Popular penticton News
  • Comments
View Site in: Desktop | Mobile