After Thursday’s positive outing, Canada’s main stock index has been on a seesaw since the market’s opening on Friday.
The S&P/TSX Composite Index, which ended Thursday’s trading at 19,063.17, quickly rolled down the hill during early morning trading, dropping as low as 18,902.93 at 10 am ET. By 10:09 a.m. ET, the index was down 142.57 points, or 0.75 per cent, at 18,920.6.
The drop was attributed to the news about Canada’s employment figures and fears of a recession. There are also concerns that the Bank of Canada will raise lending rates higher next week to stem soaring inflation.
The index had a two-per-cent drop in the materials sector, which incorporates precious and base metals miners and fertilizer companies. The financials lost 0.4 per cent.
However, sometimes morning does not show the day. Anyone who watched the morning performance of Canada’s main stock index and went away could have concluded that it would be another day of gloom. But the index tried to rally from that morning dip. By 10.50 a.m., it had risen to 19,091.41, even higher than its closing height of yesterday. And by 11.27 a.m., it inched up to 19,095.35.
By 12:19 p.m. ET, the top three performers were Yamana Gold Inc., which gained 3.64 per cent; Converge Technology Solutions Corp., which rose by 3.52 per cent; and Jamieson Wellness Inc., which added 2.51 per cent to its value.
Conversely, the biggest losers were First Quantum Minerals Ltd., which depreciated by 9.25 per cent; Capstone Copper Corp., which had 8.05 per cent slashed off its value; and Hudbay Minerals Inc., which got leaner by 7.25 per cent.
Then before midday, it seemed as if the index could not bear the stay at the top of the hill and began another roll down the hill, dropping below 19,000. By 1.07 p.m. ET, the index stood at 18,987.68. After resting for a while at the valley, it began another slow climb, crossing the 19,000 mark again just after 1.00 p.m. ET.
On Thursday, Canada’s main stock index was led by the commodity sector, which recovered from two days of gloom to finish in the green territory. Tuesday and Wednesday were not good days for oil and metal stocks, as the commodities had a lousy outing globally.
The Toronto Stock Exchange’s S&P/TSX composite index ended Thursday’s trading at 333.51 points, or 1.8 per cent, at 19,063.17. The energy sector led the gainers’ table with a gain of 4.5 per cent. The materials group followed with a gain of 2.5 per cent. The financials gained 1.3 per cent.
The stock index’s performance on Friday coincided with the release of employment figures by Statistics Canada, which showed a surprising loss of 43,200 jobs in June, contrary to projections of a gain of 22,500 jobs by economists. The unemployment rate fell 0.2 percentage points to a new record low of 4.9 per cent, comparable to the record from 1976.
Also, on Thursday, data from Statistics Canada showed that Canada’s exports surged by 4.1 per cent in May to a surprise 14-year high, buoyed by energy exports, aircraft, and potash. Conversely, imports fell 0.7 per cent. Canada’s trade surplus rose to C$5.3 billion ($4.1 billion) in May, much higher than projections of C$2.4 billion.
Even though the stock index has lost 6.12 per cent in the past one month and 6.04 per cent in the past one year, it was looking as if it would end the week on a positive note, having gained marginal 0.91 per cent in the past five days.
Now let us look at the stories that have attracted the interest of our investor community most this week. Records show that they have shown a diversified outlook, focusing mainly on the industrial, technology and mining sectors.
Paper Excellence Group (RFP) subsidiary Domtar will acquire Resolute Forest Products (RFP).
NowVertical Group (NOW) has agreed to acquire all of the issued and outstanding securities of Resonant Analytics LLC for roughly $2.6 million.
Fireweed Metals (FWZ) has started a ground gravity survey at its Gayna River Project.
Join us again next week when we will bring you another review of the market.