TSX up almost 100 points, U.S. markets also climb ahead of jobs report

Canada’s main stock index gained almost 100 points on Thursday, helped by gains in industrial and utilities stocks, while U.S. stock markets also rose.

Markets steadily climbed throughout the day in a starkly different mood from Wednesday, when they suddenly spiked in the afternoon then erased all those gains before the close.

Wall Street managed to erase most of its losses for the week, with the Nasdaq gaining 1.5 per cent.

Wednesday saw the U.S. Federal Reserve announce it was holding its key interest rate steady again until it has more confidence that inflation is on the right track.

“Today is kind of the digestion day,” said Konstantin Boehmer, head of fixed income at Mackenzie Investments.

The S&P/TSX composite index closed up 94.67 points at 21823.22.

In New York, the Dow Jones industrial average was up 322.37 points at 38225.66. The S&P 500 index was up 45.81 points at 5064.20, while the Nasdaq composite was up 235.48 points at 15840.96.

Though the Fed left rates alone on Wednesday, it indicated that it plans to ease off a bit on other quantitative tightening measures, a somewhat doveish move, said Boehmer.

“I would read it as their hands are tied right now on being able to cut rates,” he said.

“In the meantime, they’re trying to do some positive things for the market.”

Fed decision day always makes markets nervous, said Boehmer.

Earnings from big U.S. companies, including Qualcomm and Carvana, helped to drive markets higher, while Apple’s stock price also rose ahead of its after-the-bell earnings release.

The strength was also likely being helped by weakness in the U.S. dollar, he noted, amid ongoing volatility in currency markets.

“I believe that that is the catalyst also for equities to do well, because a weaker dollar is generally good for a lot of things. Because the U.S. dollar is kind of the pressure valve,” said Boehmer.

“Now that we’ve seen a couple of days of U.S. dollar weakness, this is actually providing some relief for risky assets, for emerging markets, for equities.”

Today will see the latest report on the U.S. jobs market, one of the most important economic data figures in the Fed’s rate considerations.

The jobs market hasn’t weakened under the weight of interest rates the way the Fed is looking for, said Boehmer.

In Canada, the economic picture is looking weaker than the U.S. — and cuts could be around the corner.

“I think it is heating up nicely for a central bank cut at the next meeting, which is June,” said Boehmer.

The Canadian dollar traded for 73.00 cents US compared with 72.68 cents US on Wednesday.

The June crude oil contract was down five cents at $78.95 US per barrel and the June natural gas contract was up 11 cents at $2.04 US per 1,000 cubic feet.

The June gold contract was down $1.40 US at $2,309.60 US an ounce and the July copper contract was down seven cents at $4.48 US a pound.