Bank, energy stocks galvanize investors

TORONTO — Bank and energy stocks led gains in the Toronto stock market Monday as investors returned from the Easter holiday weekend with an eye toward the earnings season, while seemingly shrugging off growing tension between North Korea and the U.S.

Despite the rising geopolitical risks, the Toronto Stock Exchange’s S&P/TSX composite index climbed 149.41 points to 15684.89, with nearly all sectors finishing the day in the positive.

The Canadian dollar also rose, up 0.07 of a cent to 75.10 cents US.

New York markets were similarly strong with the Dow Jones industrial average gaining 183.67 points to 20636.92, the S&P 500 index adding 20.06 points to 2,349.01 and the Nasdaq composite index ahead 51.64 points to 5856.79.

Investors on both sides of the border appeared not to give much weight to harsh words exchanged between North Korea and the U.S. after the Asian country launched a failed missile test on Sunday.

North Korea’s deputy UN ambassador has warned that increasing tension with the U.S. means a nuclear war might break out at any moment and that the country is ready to react to any mode of war desired by the Americans.

U.S. President Donald Trump said North Korean leader Kim Jong Un needs to behave and vice-president Mike Pence said America’s patience is wearing thin over North Korea’s unwillingness to get rid of its nuclear weapons and ballistic missiles.

Canadian markets strategist Craig Fehr said that usually, that type of rhetoric would send stock markets plummeting. But investors seemed to have turned a blind eye to them, and instead are focused on the current corporate U.S. earnings cycle and strong global economic indicators, he said.

“We’ve got equities rising, which is just a refocus on earnings this week, which are likely to be positive,” said Fehr, who works at Edward Jones in St. Louis.

Despite the gains in stocks, there are some still some signs of uncertainty in the markets, as gold prices continue to rise.

In commodities, the June gold contract was higher for a fourth straight day, up $3.40 at $1,291.90 US an ounce.

“Gold is the investment or asset class that’s continuing to show that nervousness about the issues going around the world,” he said.

In other commodities, the May crude contract fell 53 cents at $52.65 US per barrel, May natural gas contracts lost six cents at $3.16 US per mmBTU and the May copper contract was up three cents at $2.60 US a pound.