Canada’s main stock index rose on Monday amid broad-based gains led by health care and energy stocks.
The Toronto Stock Exchange’s S&P/TSX Composite index was unofficially up 96.01 points, or 0.62 per cent, at 15,602.32.
The TSX eked out a 1-per-cent gain in the previous week, holding up its seven-week rally.
On Monday, marijuana producers led a 5-per-cent jump in health care stocks.
Aphria Inc. jumped 12.9 per cent, while Cronos Group Inc. and Aurora Cannabis Inc. finished 11.9 per cent and 8.8 per cent higher, respectively.
Energy stocks rose 1.2 per cent despite a dip in oil prices. Suncor Energy Inc. and Imperial Oil Ltd. both rose 2.4 per cent.
Lagging shares were OceanaGold Corp., down 6.4 per cent, Canfor Corp., down 5.8 per cent, and Norbord Inc., lower by 5.0 per cent
Wall Street gained on Monday as technology shares rose ahead of quarterly results from Alphabet Inc, the last member of the FAANG group of internet companies to announce its earnings.
Shares of Google parent Alphabet Inc rose 2 per cent, while shares of tech companies Apple Inc and Microsoft Corp each rose more than 2.8 per cent. Apple and Microsoft’s gains helped S&P 500 technology stocks gain 1.6 per cent, the greatest rise among the benchmark index’s major sectors.
FAANG earnings have been a mixed bag so far. Shares of Apple and Facebook Inc rose after those companies’ quarterly results, while downbeat forecasts from Netflix Inc and Amazon.com Inc dragged down those companies’ shares.
Continued optimism regarding a possible trade truce between the United States and China also boosted tech shares in particular, said Shawn Cruz, manager of trading strategy at TD Ameritrade in Jersey City, New Jersey.
“That’s the theme that’s going to be driving markets for the next couple of months, a focus on geopolitical headlines,” he said. “There’s not any negative news developing on the trade dispute with China front. That’s giving tech a little bit of a bid today.”
S&P 500 industrial stocks, another trade-sensitive group, posted the second-highest percentage gain among sectors, advancing 1.3 per cent.
However, declines in shares of UnitedHealth Group Inc and Johnson & Johnson pulled the healthcare sector 0.6 per cent lower.
The Dow Jones Industrial Average rose 175.82 points, or 0.7 per cent, to 25,239.71, the S&P 500 gained 18.33 points, or 0.68 per cent, to 2,724.86 and the Nasdaq Composite added 83.67 points, or 1.15 per cent, to 7,347.54.
After having dropped nearly 20 per cent below its record Sept. 20 close, the S&P 500 is now less than 8 per cent away from reaching that level. U.S. stocks have been lifted so far this year by the Federal Reserve’s resolve to be “patient” with further interest rate hikes in addition to signs of progress in U.S.-China trade talks.
Earnings season has also been relatively positive. About 71 per cent of the S&P 500 companies that have reported so far have exceeded analysts’ estimates, according to IBES data from Refinitiv.
Analyst estimates for fourth-quarter profit growth are now at 15.4 per cent. The profit growth forecast for the first quarter of 2019, however, is much lower at 0.5 per cent.
Oil prices fell on Monday after disappointing U.S. factory data sparked fresh concerns about a slowdown in the global economy, but losses were limited as OPEC-led supply cuts and U.S. sanctions against Venezuela pointed to tighter supply.
Brent crude futures dropped 24 cents, or 0.38 per cent, to settle at $62.51 a barrel. U.S. West Texas Intermediate (WTI) crude futures fell 70 cents, or 1.27 per cent, to settle at $54.56 a barrel.
Weighing on oil markets, U.S. government data showed new orders for U.S.-made goods unexpectedly fell in November, with sharp declines in demand for machinery and electrical equipment.
“In a market that’s looking for direction, there’s concern that any slowdown in the manufacturing sector would slow down demand. Because the number was a little disappointing, it played into the slowing demand scenario,” said Phil Flynn, oil analyst at Price Futures Group in Chicago.
Prices also dipped after data showed U.S. crude inventories at Cushing, Oklahoma, the delivery point for U.S. crude futures, rose by more than 943,000 barrels in the week to Feb. 1, traders said, citing data from market intelligence firm Genscape.
Crude futures earlier posted around two-month highs. Brent reached $63.63 a barrel, the highest since Dec. 7, while WTI climbed to $55.75 a barrel, the strongest since Nov. 21.
Prices have been buoyed by a new round of supply cuts from the Organization of the Petroleum Exporting Countries and its allies that began in January. OPEC supply fell last month by the largest amount in two years, a Reuters survey last week found.
Reuters