The markets today
Positive signals from U.S.-China trade talks and rising oil prices helped Canada’s main stock index to reach a near four-week high on Tuesday.
Investors latched onto hope of a trade deal as markets have been fragile and lacked a solid direction in recent months, says Dominique Barker, portfolio manager at CIBC Asset Management. “Things have been so battered that any inkling of good news is interpreted with enthusiasm and stock prices are reacting accordingly,” she said in a phone interview.
U.S. President Donald Trump gave investor sentiment a boost when he tweeted that talks with China were “going very well.” The involvement of a senior Chinese official also buoyed expectations, said Barker.
But she warned about the impact of failure.
“If we get a poor outcome from the trade talks we could see the market down again, potentially even below those levels from four weeks ago.”
The S&P/TSX composite index closed up 101.02 points to 14,605.15 after hitting 14,645.61, the highest level since Dec. 13. The biggest gainers on the day were Nutrien Ltd., CGI Group Inc., Enbridge Inc., Canadian Pacific Railway Ltd. and Alimentation Couche-Tard.
The weakest were the Royal Bank of Canada, Sun Life Financial Inc., Brookfield Asset Management Inc., Telus Corp. and Thomson Reuters Corp.
All sectors save for health care were in positive territory, led by technology, utilities and consumer discretionary.
The influential materials, industrials and financials sectors were in the middle of the pack.
The February gold contract was down US$4 at US$1,285.90 an ounce and the March copper contract was up 1.9 cents at US$2.66 a pound.
The key energy sector rose slightly as the February crude contract was up US$1.26 at US$49.78 per barrel and the February natural gas contract was up 2.3 cents at US$2.97 per mmBTU.
Oil prices rose for an eighth consecutive day as the result of production cuts from OPEC, Russia and Alberta taking effect in the new year.
The Canadian dollar traded at an average of 75.23 cents US compared with an average of 75.11 cents US on Monday.
In New York, the Dow Jones industrial average gained 256.10 points to reach 23,787.45.
The S&P 500 index rose 24.72 points at 2,574.41, while the Nasdaq composite was up 73.53 points at 6,897.00.