The Toronto stock market climbed on Wednesday to a new record high, as Shopify took over as Canada’s most valuable publicly traded company after the e-commerce firm reported quarterly results that impressed investors, sending its shares soaring. U.S. stocks also ended higher, led by a more than 1% gain in the Nasdaq, as Apple shares climbed after news of its plans to announce a domestic manufacturing pledge.
The S&P/TSX composite index ended up 350.79 points, or 1.3%, at 27,920.87, exceeding the record closing high it posted on Tuesday.
“All the heavy lifting is being done by one stock today, and that’s Shopify,” said Mike Archibald, a portfolio manager at AGF Investments. “The numbers were astonishing - an absolute blowout quarter.”
Shopify Inc reported second-quarter results that beat estimates and forecast upbeat revenue for the third quarter, saying there was no slowdown in consumer demand yet and sellers on its platform are holding up well under tariff pressures. Its shares ended 21.5% higher in a move that lifted the company’s market capitalization to roughly C$277 billion, surpassing that of Royal Bank of Canada .
The technology sector climbed 5.1%, while financials added 0.4% and the materials group, which includes metal mining shares, ended 0.6% higher. Shares of SSR Mining jumped 17.1% after the company beat second-quarter profit expectations. Industrials were a drag, losing 0.6%.
Thomson Reuters reported higher revenue for the second quarter, during which it launched new AI features in its tax and accounting and legal divisions. The shares ended down 10.1%, however, with some analysts disappointed the company did not raise its financial guidance. Energy also lost ground, falling 0.5%, as the price of oil settled 1.2% lower at US$64.35 a barrel.
On Wall Street, shares of Apple jumped 5.1% and provided the biggest boost to all three of the major indexes after a White House official said the company would announce a US$100-billion domestic manufacturing pledge. The official announcement came after markets closed.
In addition, shares of McDonald’s rose 3% after the fast-food restaurant’s affordable menu drove global sales past expectations, while Arista Networks shares jumped 17.5% after the cloud networking company projected current-quarter revenue above estimates.
“Earnings continue to come in better than expected,” said Sam Stovall, chief investment strategist at CFRA Research.
He said while there is uncertainty surrounding tariffs, investors appear to be upbeat about the near term.
Results are now in from about 400 of the S&P 500 companies for the second-quarter earnings season.
About 80% of reports are beating analyst earnings expectations - above the 76% average of the last four quarters - and earnings growth for the quarter is estimated at 12.1%, up from 5.8% at the start of July, according to LSEG data.
Also positive for stocks were increasing bets for a September interest rate cut from the Federal Reserve. Last week’s jobs report showed slowing employment growth and downward revisions for previous months.
Minneapolis Fed President Neel Kashkari said on Wednesday the Fed may need to cut rates in the near term to account for a slowing economy.
Market expectations for a September rate cut of at least 25 basis points from the Fed stood at 95.2%, up from 92.9% in the prior session and well above 46.7% from a week ago, according to CME’s FedWatch Tool.
Investors also awaited Trump’s choice to fill a slot on the Fed’s Board of Governors.
The Dow Jones Industrial Average rose 81.38 points, or 0.18%, to 44,193.12, the S&P 500 gained 45.87 points, or 0.73%, to 6,345.06 and the Nasdaq Composite gained 252.87 points, or 1.21%, to 21,169.42.
Bucking the day’s trend, shares of chip company Advanced Micro Devices and server maker Super Micro Computer fell sharply after the companies posted disappointing results in their data center segments. Advanced Micro was down 6.4% and Super Micro was down 18.3%.
Walt Disney delivered a strong quarter and lifted its full-year outlook, but its shares eased 2.7%.
Advancing issues outnumbered decliners by a 1.12-to-1 ratio on the NYSE. There were 166 new highs and 76 new lows on the NYSE. On the Nasdaq, 2,195 stocks rose and 2,377 fell as declining issues outnumbered advancers by a 1.08-to-1 ratio. Volume on U.S. exchanges was 16.85 billion shares, compared with the 18.27-billion average for the full session over the last 20 trading days.
Reuters, Globe staff