JOBS DATA BOOST DOW ABOVE 17,000
TORONTO — The Toronto stock market closed little changed Thursday even as job creation data from the United States blew past expectations and raised hopes for a stronger showing by the economy in the second quarter.
The S&P/TSX composite index backed away slightly from Wednesday’s record-high close to decline 2.68 points to 15,207.11. The TSX was held back in part by gold stocks as bullion prices retreated in the wake of data from the U.S. Labor Department showing that the American economy produced 288,000 jobs in June.
Economists had forecast that about 215,000 jobs were cranked out last month. There was also relief that the U.S. jobless rate edged down to 6.1% from 6.3%. Canadian employment data for June will be released July 11. U.S. indexes ran up smartly in a shortened session ahead of the Independence Day holiday Friday, when markets will be closed.
The Dow Jones industrials closed above the 17,000-mark for the first time, up 92.02 points to 17,068.26, the Nasdaq rose 28.20 points to a 14-year high of 4485.93 and the S&P 500 index gained 10.82 points to 1985.44.
The jobs data also persuaded analysts that damage to the U.S. economy in the first quarter was contained and secondquarter performance will be much more impressive. The economy contracted by 2.9% in the first quarter, largely because of severe winter weather.
The Canadian dollar was up 0.24 of a cent to US93.99¢ as other data showed that Canada’s trade deficit with the world narrowed in May. Statistics Canada said the deficit came in at $152-million, down sharply from $961-million in April, thanks in large part to a strong showing by the auto sector.
The strong jobs data and solid manufacturing reports from the U.S. and China earlier in the week boosted the Dow industrials 216.42 points or 1.28% this past week. The Toronto market also headed for a strong gain, led by mining and financial stocks.
The gold sector was a major weight on the TSX, down about 1.25% as the jobs data pushed bullion down US$10.30 to US$1,320.40 an ounce.
“When the U.S. economy is gaining strength, that’s when you see the price of gold drop,” said Allan Small, senior advisor at HollisWealth. “It was no coincidence that the price of gold reached US$1,900 when the economy was in the dumps. Now we’re seeing the opposite.” The tech sector was down 1.2%. BlackBerry Ltd. slipped 10¢ to $11.29 as the smartphone maker said that it is selling its research and development department in Germany to Volkswagen Infotainment, a subsidiary of the automaker that makes interactive technology built into vehicle dashboards.
The energy sector slipped 0.22% as crude oil moved down US42¢ to US$104.06 a barrel. The TSX base metals sector led advancers Thursday, up 3.4% while September copper was US1¢ higher at US$3.28 a pound. The financials sector was also a major gainer, up 0.33%.