Bombardier soars, U.S. markets roar
Canada’s main stock index rose modestly in a largely broad-based advance Friday, as U.S. stocks soared to new record highs.
The S&P/TSX composite index was up 35.21 points to 16,239.22, with the industrials sector among key advancers as Bombardier Inc. shares surged 15.31 per cent following news it won its trade dispute with Boeing Co.
The U.S. International Trade Commission ruled in favour of the Canadian plane maker, voting that Boeing did not suffer harm from prospective imports of C Series commercial jets. The ruling means antidumping and countervailing duties totalling about 300 per cent imposed by the U.S. Department of Commerce won’t be applied. Bombardier’s stock was up 47 cents to $3.54 at the closing of markets.
South of the border, Wall Street roared back into positive territory amid comments by Donald Trump at the World Economic Forum in Davos, in which the U.S. president said his administration isn’t opposed to international co-operation. “I think the market really took a lot of positives away from that,” said JJ Kinahan, chief investment strategist for TD Ameritrade.
In New York, the Dow Jones industrial average climbed 223.92 points to 26,616.71. The S&P 500 index gained 33.62 points to 2,872.87 and the Nasdaq composite index advanced 94.61 points to 7,505.77.
U.S. stocks powered to their biggest gain in almost nine months as drugmakers and technology companies surged. Investors were cheered that Trump appeared to take a more positive tone on international trade.
AbbVie boosted biotechnology companies with a strong fourth quarter and a greater annual profit forecast, while Pfizer and other drugmakers also made big gains. Intel had its best day in almost nine years after its fourth-quarter results reassured investors that security flaws recently discovered in its processors aren’t damaging its sales. Wynn Resorts tumbled following numerous allegations of sexual assault and harassment by Steve Wynn, the casino operator’s chairman, CEO and biggest shareholder.
Speaking at the World Economic Forum in Davos, Trump said leaders should prioritize their own countries, but his administration isn’t opposed to international co-operation and that continued growth for the U.S. economy is good for the rest of the world.
On Wednesday and Thursday, comments from Trump as well as Treasury Secretary Steven Mnuchin and Commerce Secretary Wilbur Ross contributed to swings in stock prices and the dollar as investors tried to parse the remarks for indications of administration’s stances on the dollar and international trade.
The Commerce Department said the U.S. economy grew 2.6 per cent in the fourth quarter. That was a bit less than analysts predicted but still a solid result, as Americans continued to shop and home construction increased. The economy grew 2.3 per cent in 2017 and experts think growth will speed up this year, partly because of the tax cut package signed into law in December.
Technology and industrial companies made hefty gains, as did Amazon and other retailers, and banks rose along with interest rates. Those companies tend to benefit from more global trade and faster economic growth. Many of them are helped by a weaker dollar, and the U.S. currency declined again Friday.
The greenback declined further against other currencies on Friday as the Canadian dollar closed at an average trading value of 81.16 cents US, up 0.01 a U.S. cent.
The March crude contract gained 63 cents to US$66.14 per barrel and the March natural gas contract was up eight cents to US$3.18 per mmBTU. The February gold contract was down $10.80 to US$1,352.10 an ounce and the March copper contract gave back two cents to US$3.20 a pound.