© Reuters. FILE PHOTO: A sign board displaying Toronto Stock Exchange (TSX) stock information is seen in Toronto June 23, 2014. Canada’s main stock index was little changed on Monday as weakness in financial and energy shares offset gains in the materials sector.
By Johann M Cherian and Fergal Smith
(Reuters) – Canada’s commodity-heavy main stock index rose on Friday to its highest closing level in more than two weeks as encouraging economic data from major energy importer China allayed fears of a global economic slowdown.
Activity in China’s services sector expanded at the fastest pace in six months in February as the removal of tough COVID-19 restrictions revived customer demand.
“China was closed for months and just improving economic data gives buyers of commodity stocks confidence that those prices can hold, and as we know it is a good chunk of the TSX index,” said Barry Schwartz, portfolio manager at Baskin Financial Services.
The Toronto Stock Exchange’s S&P/TSX composite index ended up 244.37 points, or 1.2%, at 20,581.58, its highest closing level since Feb. 16. For the week, it was up 1.8%, after a three-week decline.
Wall Street also advanced as U.S. Treasury yields eased and economic data helped investors look past the growing likelihood that the Federal Reserve will keep its restrictive policy in place for longer than anticipated.
The Toronto market’s energy sector gained 1.7% as oil settled 1.9% higher at $79.68 a barrel, while the materials group, which includes precious and base metals miners and fertilizer companies, added 1.5%.
Combined, the energy and materials sectors account for about 30% of the TSX’s weighting.
All ten of the TSX’s major sectors gained ground, including a gain of 2.4% for technology, while financials were up 0.9%.
Among individual stocks, Suncor Energy (NYSE:) Inc added 1.4% after Equinor said it would acquire the British oil and gas business of the energy firm for $850 million.
Sleep Country Canada Holdings Inc was up 5.9% after the company’s fourth-quarter sales and earnings beat estimates.
Read More
(Headline)
TSX Snaps Weekly Losing Streak, Investors Celebrate Positive Chinese Economic Data
The Toronto Stock Exchange (TSX) ended a four-day losing streak on Friday, as investors responded to promising economic data from China, giving a boost to benchmark stock indexes.
The S&P/TSX Composite Index rose 35.54 points, or 0.25%, to 14,338.37, snapping a weekly decline of 1.2%. Shares of financial companies helped to lead the charge, rising 0.7%.
The positive news from China came after the world’s second-largest economy released its purchasing managers’ index for August, showing an impressive improvement from July levels. The manufacturing sub-index rose to 51.0 from 49.9, its highest since February, indicating sales and production at factories improved. Any reading above 50 indicates growth.
The figures indicate that China’s economy may have bottomed out after experiencing a prolonged slowdown, which put a damper on the global economy.
The overall sentiment was bolstered further by better-than-expected manufacturing data from the United States. The U.S. manufacturing PMI rose to 53.1 in August, up from 52.6 in July.
With both the U.S. and China making signs of recovery, investors have reason to be optimistic going forward.
The TSX is up 11.3% this year, lagging behind U.S. indexes. The S&P 500 is ahead 16.9%, while the Dow Jones Industrial Average is up 16.2%.
Analysts also point to lower oil prices as a contributing factor for North American stock markets. U.S. oil ended at $41.99 a barrel on Friday, a more than two-year low.
In other news, drug manufacturer Bausch Health Companies surged 4.6%, after announcing it had been granted U.S. Food and Drug Administration approval for idalopirdine, the first drug to be approved for the treatment of cognitive impairment associated with Alzheimer’s disease.
With optimism in the markets running high, the TSX looks to be setting itself up for a strong finish to the third quarter.
(Subhead)
Investors Optimistic For Q3 As TSX Rebounds On Chinese PMI Improvement.
