The mar­kets to­day

The Prince George Citizen - - Money -

North Amer­i­can stock mar­kets ended a two-day slide with mixed U.S. cor­po­rate earn­ings re­in­forc­ing ex­pec­ta­tions of in­ter­est rate cuts.

As the first week of sec­ondquar­ter re­sults nears a close, com­pa­nies, in­clud­ing banks, have gen­er­ally beaten the weak an­a­lyst fore­casts.

If you dig a lit­tle deeper, how­ever, the re­ports sug­gest un­der­ly­ing chal­lenges ahead in­clud­ing the im­pact on banks from a lower in­ter­est rate en­vi­ron­ment, said Kash Pashootan, CEO and chief in­vest­ment of­fi­cer at First Av­enue In­vest­ment Coun­sel Inc. “Al­though we have seen some de­cent earn­ings beats, the bar is quite low,” he said. “What’s sur­pris­ing to us is that with fairly low ex­pec­ta­tions on earn­ings num­bers, we’re still see­ing a mixed bag. We think that given the ex­pec­ta­tions are quite con­ser­va­tive and the bar is quite low, we should see a much rosier pic­ture for the earn­ings beats.” Pashootan said earn­ings are the pri­mary driver of mar­kets af­ter in­vestors have grown tired of read­ing tea leaves on trade ne­go­ti­a­tions be­tween the U.S. and China, eco­nomic data and cen­tral bank­ing pol­icy.

Yet, the mixed or dis­ap­point­ing re­sults in­crease the prob­a­bil­i­ties of in­ter­est rate cuts, which is sup­port­ing mar­kets to inch higher, he added.

The S&P/TSX com­pos­ite in­dex closed up 10.02 points at 16,494.23, af­ter los­ing 26.61 points over the last two days. In New York, the Dow Jones in­dus­trial av­er­age was up 3.12 points at 27,222.97. The S&P 500 in­dex was up 10.69 points at 2,995.11, while the Nas­daq com­pos­ite was up 22.04 points at 8,207.24.

The Toronto mar­ket rose pri­mar­ily as the strength of the ma­te­ri­als sec­tor off­set de­clines in health care and en­ergy. The Au­gust gold con­tract was up US$4.80 at US$1,428.10 an ounce, the high­est level since May 2013. In­ter­est-rate sensitive com­modi­ties like gold are gain­ing with an­tic­i­pa­tion of rates go­ing lower.

The Sep­tem­ber cop­per con­tract was down 0.6 of a cent at US$2.71 a pound. Among the gain­ers were First Ma­jes­tic Sil­ver, Ya­mana Gold and Bar­rick Gold Corp.

The health care sec­tor dropped 2.1 per cent as sev­eral cannabis pro­duc­ers suf­fered share price de­creases, in­clud­ing Au­rora Cannabis Inc, which fell 6.5 per cent.

Newspapers in English

Newspapers from Canada

© PressReader. All rights reserved.