Energy and materials lead stocks in Toronto higher, U.S. markets also surge - InfoNews

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Energy and materials lead stocks in Toronto higher, U.S. markets also surge

The Toronto Stock Exchange Broadcast Centre is pictured in Toronto on June 28, 2013. THE CANADIAN PRESS/Aaron Vincent Elkaim
March 29, 2018 - 2:20 PM

A broad rally in Toronto allowed Canada's main stock index to close the quarter with a triple-digit gain Thursday as U.S. markets also posted strong results.

Strong performances from the four main North American indexes came despite no clear triggers for the gains, said Kash Pashootan, CEO and chief investment officer at First Avenue Investment Counsel Inc.

"What's interesting is there's no real catalysts to the market going up today, compared to the pessimism and concerns that have led to the enhanced levels of turbulence in the last few weeks."

He said some of the gains could potentially be attributed to the end of quarter practice of dumping underperforming stocks and buying rising stocks to improve portfolio appearances at quarter end ahead of the Easter holiday weekend.

"A pessimist may look at this market and say the rise today is rooted in window dressing from portfolio managers given the quarter is ending, given that really the news and the sentiment has not changed in any significant way."

The S&P/TSX composite index closed up 197.35 points at 15,367.29, led by rebounding energy and materials stocks. The late-week gains still left the index down 0.21 per cent for the week and down 5.2 per cent so far this year.

In New York, the Dow Jones industrial average closed up 254.69 points at 24,103.11. The S&P 500 index ended up 35.87 points at 2,640.87 and the Nasdaq composite index was up 114.22 points at 7,063.45 as technology stocks saw broad gains.

The markets can expect continued wide swings as the sources of volatility, including trade war uncertainty and heightened valuations, are still present, said Pashootan.

The Canadian dollar closed at 77.56, up 0.05 cents US even as the Canadian economy posted lower-than-expected January GDP numbers.

Statistics Canada said the economy contracted 0.1 per cent in January, compared to the 0.1 per cent gains expected according to Thomson Reuters, on unscheduled maintenance shutdowns in the oilpatch and weakness in the real estate sector following mortgage rule changes.

The dip didn't move the loonie lower because it's already seen downward pressure lately, said Pashootan.

"The fact is it's one report, and so the market is not reacting to the lower GDP number that we saw, partly because the loonie has been under quite a bit of pressure."

"We were starting from a much more realistic point than when the Canadian dollar was over 80 cents, being its 30-year average. And the other part of it too is we're seeing some strength with oil prices."

The May crude contract closed up 56 cents at US$64.94 per barrel and the May natural gas contract was up three cents at US$2.73 per mmBTU.

The June gold contract ended down US$2.70 at US$1,327.30 an ounce and the May copper contract was up two cents at US$3.02 a pound.

Note to readers: This is a corrected story. An earlier version incorrectly stated S&P 500 closing figure as 2,650.87

News from © The Canadian Press, 2018
The Canadian Press

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