The energy sector pushed Canada’s main stock index up on Friday, as oil prices rose on supply concerns ahead of a meeting of OPEC and other large crude exporters.
The energy sector climbed 0.7 per cent as Brent crude oil rose 2 cents at $78.72 a barrel and U.S. light crude gained 21 cents at $70.53.
At 11:30 a.m. ET, the TSX composite index was up 23.59 points, or 0.15 per cent, at 16,238.34.
Three of the index’s 11 major sectors were lower, with the healthcare sector’s 2.5-per-cent fall being the steepest.
Marijuana producers dropped in morning trading with Canopy Growth Corp. falling 4 per cent and Aphria Inc. down 3.1 per cent.
In New York, B.C.-based Tilray Inc. was down 26.9 per cent, enduring another day of volatile trading.
Shares of precious metal miners Barrick Gold, Goldcorp, Nutrien fell between 0.5 per cent and 2.8 per cent, and were the biggest drags to the main index.
Spot gold fell 1 per cent to $1,194.56 per ounce
Economic data showed Canada’s inflation rate dipped to 2.8 per cent in August, but remained above the Bank of Canada’s target for the seventh consecutive month, boosting expectations the central bank will raise rates again in October.
The U.S. dollar rebounded and world shares hit a more than six-month high on Friday after China's moves to boost domestic consumption bolstered a rally driven by investor bets the latest U.S.-Sino trade salvoes were unlikely to dent global growth.
The U.S. benchmark S&P 500 stock index and the Dow industrials scaled record peaks for a second session, though the Nasdaq turned lower soon after the market opened.
MSCI’s gauge of stocks across the globe gained 0.39 per cent to hit six-month highs.
Sterling tumbled and pushed the dollar up after British Prime Minister Theresa May said Brexit talks had hit an impasse and that the European Union must offer an alternative plan after the bloc’s leaders rejected her plans.
The pound fell 1.36 per cent, and was on course for its biggest daily loss since June 2017.
“Sterling bears are out in full force. They’ve pushed the pound quite aggressively down this morning,” said Dean Popplewell, a chief currency strategist at Oanda in Toronto.
The U.S. dollar rebounded from early lows but was still set for its biggest weekly drop since February as the equity market rally and rising bond yields fueled a rush to buy riskier assets. The dollar index rose 0.26 per cent to 94.159 against a basket of major currencies.
A rally in Chinese markets helped lift MSCI’s broadest index of Asia-Pacific shares outside Japan 1.32 per cent, partly on expectations that Beijing will pump more money into its economy to weather the trade war.
Miners and banks drove Britain’s top share index FTSE up 1.6 per cent, while Germany’s DAX, home to some of the continent’s biggest exporters, rose 0.53 per cent.
U.S. capital markets are exuberant, with stock valuations high at 21 times trailing earnings and struggling economies around the world a risk for U.S. stocks, said Michael Geraghty, equity strategist at Cornerstone Capital Group in New York.
“There’s really been no bad news to cause this market to take a breather for weeks,” Geraghty said. “The risk for U.S. equity markets is what’s going on overseas.”
The Dow Jones Industrial Average rose 48.39 points, or 0.18 per cent, to 26,705.37. he S&P 500 gained 2.73 points, or 0.09 per cent, to 2,933.48 and the Nasdaq Composite dropped 21.76 points, or 0.27 per cent, to 8,006.47.
Shares of Boeing and 3M, among U.S. companies most exposed to a trade war, were higher. However, semiconductor makers declined after top chipmaker Micron said U.S. tariffs on Chinese goods would weigh on results for as much as a year.
U.S. long-dated Treasury yields slipped, in tandem with those in Europe, as Brexit talks stalled between Britain and the European Union.
U.S. 2-year yields, however, remained unaffected as they hit a fresh 10-year high in the run-up to an expected rate increase at next week’s Federal Reserve monetary policy meeting.
Benchmark 10-year notes last rose 3/32 in price to yield 3.0683 per cent.
Reuters