The markets today
North American stock markets partially rebounded from Friday’s selloff on talk of renewed trade negotiations following tariff tit-for-tat between the U.S. and China.
The rally started after President Donald Trump claimed China was willing to reopen trade talks. It continued even after China’s foreign ministry said it didn’t know what Trump was talking about.
“I would say it is all about hope,” said Allan Small, senior investment adviser at HollisWealth, noting he doesn’t believe either country wants tariffs to increase as of Sunday’s deadline.
Markets sank Friday after Trump reacted to China’s threat of tariff hikes on US$75 billion of American products by ordering U.S. companies to look at leaving China. He then announced plans after markets closed to add five per cent to tariffs on US$550 billion worth of imports on Sept. 1 and Oct. 1. What remains to be seen is if China will still travel to the U.S. next month to resume formal talks, Small said.
He added that Trump frequently responds to market selloffs by making positive comments a few days later that are wellreceived by investors.
The S&P/TSX composite index closed up 61.21 points at 16,098.79 after losing almost 216 points on Friday.
In New York, the Dow Jones industrial average was up 269.93 points at 25,898.83. The S&P 500 index was up 31.27 points at 2,878.38, while the Nasdaq composite was up 101.97 points at 7,853.74. Officials from the world’s two largest economies have to move quickly to prevent planned tariff increases on Sunday, but Small doubts that a complete deal can be reached by then.
Nine of the 11 major sectors of the TSX rose in the broadbased rally, led by consumer discretionary, technology, consumer staples and financials. Telecommunications and materials were the lone losing sectors. Materials fell slightly as shares of First Quantum Minerals Ltd. and Yamana Gold Inc. lost 2.85 and 2.07 per cent respectively.
The December gold contract was down 40 cents at US$1,537.20 an ounce while the September copper contract was up 1.35 cents at US$2.54 a pound.
The energy sector gained 0.22 per cent with Encana Corp. climbing two per cent despite a dip in crude oil prices.