Canada’s main stock index rose on Thursday to a new record high as investors weighed prospects of the country moving closer to a trade deal with the United States at a Group of Seven leaders summit this weekend.
The S&P/TSX composite index ended up 91.59 points, or 0.4 per cent, at 26,615.75, eclipsing Wednesday’s record closing high.
U.S. Treasury Secretary Scott Bessent said he expects to attend the Group of Seven leaders meeting in Canada, which runs from June 15 to 17, with President Donald Trump, and the two of them will likely meet with Canadian Prime Minister Mark Carney.
“For Canadian investors, I think there’s a building expectation that Carney and Trump may achieve some sort of agreement to de-escalate the trade and tariff war between our two countries,” Brian Madden, chief investment officer at First Avenue Investment Counsel Inc.
A U.S. tax and spending bill under consideration contains a proposed tax, known as Section 899, that applies a progressive tax burden of up to 20 per cent on foreign investors’ U.S. income as pushback against countries that impose taxes the U.S. considers unfair, such as digital service taxes.
The S&P 500 also ended higher on Thursday after a strong outlook from Oracle fuelled optimism around artificial intelligence, offsetting worries about tension in the Middle East and a drop in Boeing shares. Oracle surged to record highs after the cloud service provider raised its annual revenue growth forecast, driven by strong demand for its AI-related services. Heavyweight tech companies Microsoft, Nvidia and Broadcom also gained.
“Oracle is another piece in the mosaic of AI capex spending and the ongoing need for more compute that feeds into the AI revolution,” said Art Hogan, chief market strategist at B. Riley Wealth. “When the winds blow in that direction, you’re definitely going to see the key players like Microsoft and Nvidia also catch that tailwind.”
Boeing fell after an Air India 787-8 Dreamliner jet crashed minutes after taking off in India’s western city of Ahmedabad, killing more than 200 people.
Signs of rising tensions in the Middle East also weighed on global markets. U.S. President Donald Trump said on Wednesday that U.S. personnel were being moved out of the region as it could be a “dangerous place” and the United States would not allow Iran to have a nuclear weapon. Officials from both countries are scheduled to meet in Oman on Sunday for a sixth round of nuclear talks.
According to preliminary data, the S&P 500 gained 23.19 points, or 0.39 per cent, to end at 6,045.43 points, while the Nasdaq Composite gained 46.28 points, or 0.24 per cent, to 19,662.16. The Dow Jones Industrial Average rose 103.16 points, or 0.24 per cent, to 42,968.93. U.S.-listed shares of gold miners also advanced, as bullion prices hit a one-week high.
With Thursday’s gain, the S&P 500 remains down about 2 per cent from its February record high. Softer-than-expected producer price data and initial jobless claims numbers pointing to a potential weakening in the labor market helped reduce investor jitters around tariff-driven price pressures, while also boosting expectations the U.S. Federal Reserve will cut interest rates.
Traders project a 60 per cent chance of a 25-basis-point cut by September, according to the CME Group’s FedWatch tool.
Fed policymakers are widely expected to keep rates unchanged at next week’s policy meeting.
With investors expecting Trump to reach trade agreements with several countries in the coming weeks, the benchmark S&P 500 index is about 2 per cent below its February record high. Goldman Sachs trimmed its U.S. recession probability to 30 per cent from 35 per cent on easing uncertainty around Trump’s tariff policies. - Reuters
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