Energy, financials drag down TSX
TORONTO — Canada’s main stock index erased most of yesterday’s gains as energy and financial stocks slid on Wednesday, while U.S. markets were little changed.
The S&P/TSX composite index was down 26.44 points to 16,105.35, with the consumer staples sector one of the few bright spots.
Shares of Loblaw Companies Ltd. were up 1.38 per cent to $67.51 following news it will merge its PC Plus loyalty program with Shoppers Drug Mart’s in-house Optimum system starting in February under the name PC Optimum — a long-anticipated move that comes more than three years after the grocery giant acquired the pharmacy chain.
“In the absence of any notable economic data or central bank developments, the big market mover today was oil prices which have been swinging between gains and losses,” said Candice Bangsund, vice-president and portfolio manager at Fiera Capital.
“On one hand we had a fairly bearish U.S. Energy Information Agency report this morning where inventories did rise more than the market was expecting, so that of course was negative. But then we had a swing upward in prices on some platform closures in the Gulf that have since come back down. Right now oil prices are just marginally in the red.”
The December crude contract fell 39 cents to US$56.81 per barrel.
South of the border, Wall Street posted minor gains as investors mulled U.S. President Donald Trump’s election anniversary and his ability to make headway on his tax cut proposals.
“U.S. stocks are focusing on the potential for this tax bill to get approved by yearend,” said Bangsund. “And today markets are a bit shaky and it looks like there could be delays.”
The Dow Jones industrial average added 6.13 points to 23,563.36. The S&P 500 index inched up 3.74 points to 2,594.38 and the Nasdaq composite index advanced 21.34 points to 6,789.12.
U.S. stock indexes finished slightly higher as video game makers’ stocks jumped while banks and energy company stocks slipped. Household goods companies also rose. Time Warner Cable stock sank after AT&T said was not certain when its $85 billion US purchase of TWC would close and reports said regulators might require the companies to sell important assets.
The minor movements, however, were still enough to push the New York indices further into record-setting territory.
The S&P 500 has jumped 21 per cent since Trump was elected a year ago. That’s better than the same period after most recent presidential elections, although it trails the gains after Barack Obama was re-elected in 2012.
Investors have bet big on economic growth in the U.S. and worldwide, as technology companies have led the way with a 39-per-cent surge, and banks and industrial and basic materials companies have also soared. The economies of the 35 advanced nations in the Organization for Economic Cooperation and Development are all expected to grow this year, and most are doing better in 2017 than they did the year before.
In currency markets, the Canadian dollar was trading at an average price of 78.56 cents US, up 0.34 of a U.S. cent.
“The strengthening of the loonie today is more of a story of U.S. dollar weakness and uncertainty of tax status,” Bangsund noted.
Elsewhere in commodities, the December gold contract was up US$7.90 to US$1,283.70 an ounce.
The December natural gas contract gained two cents to US$3.18 per mmBTU and the December copper contract added a penny at US$3.10 a pound.