Shopify Inc. led Canada’s main stock index higher to start the week as the technology sector continued to thrive in Canada and the U.S. amid the COVID-19 pandemic.
The S&P/TSX Composite Index closed up 136.66 points, or 0.91%, at 15,103.22. Shopify was among the top advancers, rallying 6.16% to C$1,050.02. Its market cap at the close of trading was just slightly below that of Royal Bank of Canada, the most highly valued stock on the TSX. Shopify briefly was in the top spot last week.
But there were pockets of strength in other sectors of the Canadian stock market: Consumer staples rose 3.18%, with Canadian Tire jumping 7.81%. Brookfield Infrastructure rose 5.54%, Precision Drilling 5.19% and Inter Pipeline 5.17%.
In New York, the Dow Jones industrial average was down 109.33 points at 24,221.99. The S&P 500 index was up 0.39 points at 2,930.19, while the Nasdaq composite was up 71.02 points at 9,192.34.
On Wall Street, investors weighed new spikes in coronavirus infections with expectations that an economy crippled by mandated shutdowns will soon be re-opened for business.
Technology and health care shares provided the biggest lift to all three major U.S. stock indexes and led the tech-heavy Nasdaq to its sixth consecutive advance.
The S&P 500 and Dow Jones Industrial Average remain within 20% of all-time highs reached in February, and the tech-heavy Nasdaq is within 10% of its closing record.
Indeed, despite bleak recent economic data, including Friday’s 20.2 million drop in U.S. payrolls, Wall Street has gained in recent weeks as investors look beyond pandemic to recovery.
“Investors have been buying equities given the realistic expectation that massive fiscal and monetary stimulus will reignite economic and profit growth,” said David Carter, chief investment officer at Lenox Wealth Advisors in New York. “There is still a fair amount of optimism in the markets, but this could be quelled if coronavirus cases re-emerge.”
But a surge of new coronavirus infections in Germany and South Korea suggested early efforts to lift restrictions could be premature, even as businesses around the world, shuttered by social distancing restrictions, begin re-opening their doors.
“There’s really no playbook for a health crisis like the world is now experiencing,” Carter added. “With no playbook, there’s much less certainty and markets are more likely to vacillate.”
Of the 11 major sectors in the S&P 500, four closed in the black, with healthcare enjoying the largest percentage gain.
First-quarter earnings season is nearing the final stretch, with 440 of the companies in the S&P 500 having reported. Of those, 67.5% have beaten Wall Street estimates, according to Refinitiv data.
In aggregate, S&P 500 earnings are seen to have dropped by 12.1% in the first quarter, compared with a year ago.
Drug distributor Cardinal Health Inc jumped 6.7% as the pandemic boosted third-quarter sales.
Chesapeake Energy Corp slid 12.2% after it said bankruptcy is among the options under consideration as the shale driller copes with plummeting oil and gas prices.
Marriott missed first-quarter profit margins by a wide margin as bookings plunged. The hotel operator’s shares lost 5.6%.
Shares of Under Armour Inc plunged 9.7% after the athletic wear company forecast a 50% to 60% drop in the second quarter as many of its stores remain shuttered.
Packaged food company General Mills said it expects to surpass its fiscal 2020 sales expectations as consumers stock their pantries amid lockdowns, sending its stock up 1.8%.
The Canadian dollar traded for 71.37 cents US compared with an average of 71.77 cents US on Friday.
The July crude contract was down US$1.09 at US$25.08 per barrel and the June natural gas contract was up 0.3 of a cent at nearly US$1.83 per mmBTU.
The June gold contract was down US$15.90 at US$1,698.00 an ounce and the July copper contract was down 2.6 cents at US$2.38 a pound.
Read more: Stocks that saw action on Monday - and why
Reuters, Canadian Press, Globe staff
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