Canada’s main stock index edged lower on Monday as technology and financial shares lost ground, but the move was restrained as investors weighed prospects of Canada reaching a trade deal with the United States.
The S&P/TSX composite index ended down 53.33 points, or 0.2 per cent, at 26,375.80, after posting on Friday a record closing high.
U.S. President Donald Trump said that he was getting good reports as U.S. officials hold trade talks with China in London.
“As much as Trump seems to be having positive talks with China, there’s some optimism that he’s getting close to doing a deal with Canada as well and I think that’s been a lot of the reason why the Canadian dollar is doing better and also why the TSX is back to an all-time high,” said Greg Taylor, chief investment officer at PenderFund Capital Management.
The Canadian dollar edged higher against its U.S. counterpart as Canadian Prime Minister Mark Carney said his government would hit NATO’s military spending target of 2 per cent of GDP this fiscal year, five years earlier than promised, a move that some analysts say could ease the path to a trade deal with the United States.
Canada has been under pressure from the United States and other NATO allies for years to increase military funding.
Shares of jet maker Bombardier and aviation simulation and training company CAE gained 5.4 per cent and 2.3 per cent, respectively. Still, the industrials sector ended 0.2 per cent lower, while financials lost 0.3% and technology was down 0.8 per cent.
The materials sector added 0.6 per cent as gold and copper prices climbed.
Shares of uranium supplier Cameco jumped 10.7% after a number of analysts raised their price target on the stock.
The S&P 500 ended slightly higher on Monday, lifted by Amazon and Alphabet, while investors watched U.S.-China negotiations aimed at mending a trade dispute that has rattled financial markets for much of the year.
Top officials from both countries have kicked off discussions, looking to get back on track with a preliminary trade agreement struck last month that had briefly cooled tensions between the world’s largest economies.
“The market deems any dialogue with Beijing as progress, whether or not it leads to tangible results. The market is just going to take the administration’s word for it, until proven otherwise,” said Jake Dollarhide, CEO of Longbow Asset Management in Tulsa, Oklahoma.
Amazon and Google parent Alphabet each gained more than 1 per cent and helped keep the S&P 500 in positive territory.
Amazon.com said it plans to invest at least US$20-billion in Pennsylvania to expand data center infrastructure, adding to the billions of dollars the technology giant has committed to the expansion of artificial intelligence.
Apple dipped 1.2 per cent after the iPhone maker kicked off its annual software developer conference with incremental developments that did little to impress investors.
The S&P 500 climbed 0.09 per cent to end the session at 6,005.88 points.
The Nasdaq gained 0.31 per cent to 19,591.24 points, while the Dow Jones Industrial Average ended essentially unchanged at 42,761.76 points.
Of the 11 S&P 500 sector indexes, six declined, led lower by utilities, down 0.66 per cent, followed by a 0.55-per-cent loss in financials.
Expectations of more trade deals between the U.S. and its major trading partners, along with upbeat earnings and tame inflation data, helped U.S. equities rally in May, with the S&P 500 and the tech-heavy Nasdaq notching their best monthly gains since November 2023.
The S&P 500 remained about 2 per cent below its all-time high touched in February, while the Nasdaq is about 3 per cent below its December record high.
Warner Bros Discovery fell about 3 per cent after the company said it would separate its studios and streaming business from its struggling cable television networks. Immediately after the announcement, it had surged as much as 13 per cent.
Shares of McDonald’s dipped 0.8 per cent after Morgan Stanley downgraded the fast-food restaurant to “equal-weight” from “overweight”.
Robinhood Markets dropped almost 2 per cent after S&P Dow Jones Indices left S&P 500 constituents unchanged in its latest rebalancing, following recent speculation that the online brokerage would be added to the benchmark index.
Major data releases this week include readings on May consumer prices on Wednesday and initial jobless claims on Thursday. While investors widely expect the Federal Reserve to keep interest rates unchanged next week, focus will be on any signs of pick-up in inflation as Trump’s tariffs risk raising price pressures.
Advancing issues outnumbered falling ones within the S&P 500 by a 1.1-to-one ratio.
The S&P 500 posted 16 new highs and 4 new lows; the Nasdaq recorded 97 new highs and 46 new lows.
Volume on U.S. exchanges was relatively light, with 17.1 billion shares traded, compared to an average of 17.8 billion shares over the previous 20 sessions.
Reuters