TORONTO - Canada's main stock index gained more than 200 points Thursday, led by strength in tech, metals, financials and utilities, while U.S. markets also rose as investors digested a positive inflation print from the day before.
U.S. markets rose with another day of growth stocks outperforming equities more broadly, said Kevin Burkett, portfolio manager at Victoria-based Burkett Asset Management.
“In general, markets have turned very risk-on given yesterday’s encouraging U.S. inflation data,” said Burkett.
The S&P/TSX composite index was up 206.87 points at 20,277.64.
In New York, the Dow Jones industrial average was up 47.71 points at 34,395.14. The S&P 500 index was up 37.88 points at 4,510.04, while the Nasdaq composite was up 219.61 points at 14,138.57.
The Nasdaq led the main U.S. indexes Thursday, rising almost 1.6 per cent. Tech stocks were pulled higher by big names including Google and Nvidia, while cyclicals and consumer discretionary names also had a good day, Burkett said.
U.S. inflation data released Wednesday showed price growth slowed to three per cent in June.
Markets continue to be “obsessed” with the macroeconomic picture, said Burkett.
“I think people are paying more attention than ever to indication that inflation is continuing to moderate and it was really yesterday's CPI print that I saw changing … risk odds of interest rate decisions on both sides of the border,” he said.
On Thursday, new data also showed that producer price growth slowed in June, even as applications for jobless benefits fell again last week.
“A moderation in inflation in the U.S. has reduced the risk of seeing another barrage of interest-rate hikes there,” said Burkett.
In Canada, the tech sector was also up, pulled by Shopify, which saw its stock rise more than six per cent.
The price of oil Thursday rose above US$77 a barrel, trading at the high end of its recent range after climbing steadily all week. The August crude contract was up US$1.14 at US$76.89 per barrel.
Production cuts announced over the summer appear to be successfully balancing the market, said Burkett: “We’re seeing oil now at mid-70s, which is probably … the most convenient place for benchmark oil prices to be.”
Friday will see the big U.S. banks release earnings in a kick-off of second-quarter earnings season.
“I think people will look to those results for clues on issues in the broader economy,” said Burkett of the banks’ pending releases.
The ϳԹ dollar traded for 76.17 cents US compared with 75.83 cents US on Wednesday.
The August natural gas contract was down nine cents at US$2.55 per mmBTU.
The August gold contract was up US$2.10 at US$1,963.80 an ounce and the September copper contract was up nine cents at US$3.94 a pound.
This report by ϳԹ was first published July 13, 2023.
Companies in this story: (TSX:GSPTSE, TSX:CADUSD=X)
