TSX rises for Second week after losses

Canada’s benchmark stock index posted its second straight weekly gain after seven consecutive weekly losses, rising 0.74% as markets advanced despite mixed economic news from south of the border.

The S&P/TSX composite index closed at 12,237.75 on Friday with a gain of 91.90 points, or 0.76%. Eight of the 10 sub-indexes advanced, led by consumer services, up 1.18%, energy, which gained 0.89%, and materials, which rose 0.88%.

West Texas Intermediate crude oil prices erased earlier losses and closed at US$104.93 a barrel, up US38¢, while gold gained US$5.20 to US$1,664.80 an ounce.

The Canadian dollar gained more than 1% on the week to close just shy of US$1.02 on Friday, at US$1.0194, up 31 basis points.

“That’s the strongest level for the currency since last summer, although it’s still down about three per cent from the heady levels of a year ago,” says BMO Capital Markets deputy chief economist Doug Porter. “The currency got another push from a wayward comment by (Bank of Canada) governor (Mark) Carney in a Friday speech, suggesting that the bank ‘is not obsessed with the Canadian dollar.’”

Porter also notes that the loonie has started gaining strength just as the rest of the world “looks a bit shakier,” with the spectre of a eurozone debt crisis raising its head again in the past few weeks — Standard & Poor’s downgraded Spain’s credit rating this week — along with a series of disappointing economic reports from the U.S.

“The bottom line is that, while we believe the Canadian dollar outlook has more positives than negatives, the currency may be getting a tad ahead of itself with this latest bounce,” Porter concludes.

On Friday, the U.S. Commerce Department reported first-quarter gross domestic product came in at 2.2%, missing analysts’ call for a 2.5% gain. The Dow Jones industrial average rose 23.69 points, or 0.18%, to 13,228.31, and the Nasdaq closed at 3,069.20, up 18.59 points or 0.61%.

Investors shrugged that off and concentrated instead on better-than-expected earnings reports from Internet heavyweights Amazon.com and Expedia Inc., and improved consumer-confidence levels.

“Earnings have been spectacular, and that’s a shot in the arm to investors, but GDP is acting as a counterweight,” David Dietze, president and chief investment strategist at Summit, New Jersey-based Point View Wealth Management, told Reuters. “When coupled with other weak data, the ghost of a slowdown starts to loom and that’s causing investors to pause a little despite better-than-expected results from blue chips like Amazon.”

Canada’s junior Venture exchange rose 19.52 points, or 1.40%, to 1,412.76.