Oil up for fifth day, lifting loonie, TSX
TORONTO — The price of oil rose for a fifth consecutive day Monday, helping provide a boost to the Toronto stock market amid growing concern about geopolitical risks in the Middle East.
The S&P/TSX composite index was ahead 63.66 points to 15,730.79 as the energy and industrials sector led with the biggest gains. The strength in oil prices also helped lift the Canadian dollar, which climbed 0.44 of a cent to 75.01 cents US.
Tensions between the U.S. and Syria have helped lift the value of a barrel of a crude, with the May contract gaining 84 cents to $53.08 US per barrel. The May natural gas contract lost two cents at $3.24 US per MMBTU.
“Any time you’re talking about geopolitical uncertainties related to the Middle East, you see oil prices react to the upside,” said Craig Fehr, a Canadian markets strategist at Edward Jones in St. Louis.
“Typically you’ll see the markets settle itself out as those uncertainties start to subside. I think we’re in a period at the moment where there are more questions and answers and that’s why we’re seeing oil prices react to the upside.”
Last week, the U.S. attacked a Syrian airbase with cruise missiles after the Syrian military used chemical weapons against civilians.
Secretary of State Rex Tillerson said the U.S. missile strikes carry a message for any nation operating outside of international norms.
Fehr said the troubles in Syria have led some to question whether oil supplies will continue to build in the Middle East in the short term. “I still continue to think it’s probably an environment where oil stays right around this price, in a range around this price for some time to come,” he said, noting that reports out of the U.S. still show a growing number of shale producers are continuing to come back online.
In other commodities, the June gold contract was down $3.40 at $1,253.90 US an ounce and May copper contracts were down four cents at $2.60 US a pound.
On Wall Street, indexes were muted, with no major economic reports to rely on. It’s anticipated that trading will pick up later this week as earnings season kicks off, with some of the major U.S. banks scheduled to report on Thursday.
The Dow Jones industrial average was barely changed, gaining 1.92 points to 20,658.02. Similarly, the S&P 500 index added 1.62 points to 2,357.16 and the Nasdaq composite index was up 3.11 points to 5,880.93.
Sprott sells diversified assets, slashes staffing
TORONTO — Sprott Inc. said it will cut its staff count in half to about 100 employees as it sells its Canadian diversified assets to a management group for about $46 million.
The asset management firm said it has struck a deal with a group led by managers of its Sprott Asset Management subsidiary, CEO John Wilson and president James Fox.
Peter Grosskopf, CEO of Sprott Inc., said the sale is designed to allow the Toronto-based company focus on its “core competencies,” which include precious metals and natural resources as it pursues global opportunities in those areas.
Sprott is selling management agreements in investment funds and accounts totalling $3 billion under management and said it will enter into agreements with the buyer to provide sub-advisory services for $865 million in precious metals strategies assets.
It would be left with $7.5 billion in assets under management, including the sub-advisory agreements.