S&P/TSX composite index closes up along with U.S. markets Friday
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Hey there, time traveller!
This article was published 26/07/2024 (675 days ago), so information in it may no longer be current.
TORONTO – Widespread gains helped push Canada’s main stock index higher Friday, while U.S. stock markets also rose after an encouraging U.S. inflation report.
Stocks ended up after a bumpy week that saw tech stocks retreat on some days as markets start to pull away from a long bullish phase for the sector, said Angelo Kourkafas, senior investment strategist at Edward Jones.
“The key highlight for not just today, this week, but also last week has been this great rotation out of the mega-cap technology names into more value-style investments, small-cap stocks.”
On Friday, stock gains were widespread though after an inflation read in the U.S. showed continued declines.
“The driver was the Fed’s preferred inflation measure … that confirmed this inflation trend and also supported market expectations for a September rate cut.”
The potential U.S. rate cut comes on top of two rate cuts already from the Bank of Canada, with domestic economic indicators, and the bank itself, suggesting more to come this year.
The S&P/TSX composite index closed up 206.78 points at 22,814.81, led by metals, health care, and technology stocks.
In New York, the Dow Jones industrial average was up 654.27 points at 40,589.34. The S&P 500 index was up 59.88 points at 5,459.10, while the Nasdaq composite was up 176.16 points at 17,357.88.
Friday’s gain in the Nasdaq wasn’t enough to offset sharper drops earlier in the week, leaving it down about 370 points on the week. Next week could see more sharp movements for the tech sector as Microsoft, Meta, Apple and Amazon are set to report.
“That’s going to define really the narrative around this rotation,” said Kourkafas.
Canadian stocks could benefit from the shift away from the high-flying tech sector, but given the state of economic growth, the benefits can only go so far, he said.
“We could see a little better performance, better trends in the second half of the year, but given the macro economic backdrop, I wouldn’t think that the TSX would lead this transition phase, meaning we still have some more slack in the economy than in the U.S.”
The Canadian dollar traded for 72.31 cents US compared with 72.36 cents US on Thursday.
The September crude oil contract was down US$1.12 at US$77.16 per barrel and the September natural gas contract was down three cents at US$2.05 per mmBTU.
The August gold contract was up US$27.50 at US$2,381 an ounce and the September copper contract was down a penny at US$4.12 a pound.
This report by The Canadian Press was first published July 26, 2024.
Companies in this story: (TSX:GSPTSE, TSX:CADUSD)