TORONTO - Canada's main stock index posted a small loss Friday led by weakness in energy stocks, while U.S. markets were lifted to another record high by tech stocks and a hot jobs report.
Between Thursday and Friday, U.S. markets more than erased Wednesday鈥檚 selloff.
Markets sank Wednesday after the U.S. Federal Reserve held its key interest rate steady and made comments indicating they were unlikely to start cutting the rate as early as many had hoped.
The comments 鈥渂asically threw a big bucket of cold water鈥 on hopes for rate cuts to begin in March, said Philip Petursson, chief investment strategist at IG Wealth Management.
But a batch of promising U.S. economic data on Thursday followed by the blowout jobs report Friday helped ease the sting, he said.
The S&P/TSX composite index closed down 34.12 points at 21,085.09.
In New York, the Dow Jones industrial average was up 134.58 points at 38,654.42. The S&P 500 index was up 52.42 points at 4,958.61,while the Nasdaq composite was up 267.31 points at 15,628.95.
The latest jobs report showed that U.S. employers added twice as many jobs in January as economists had predicted, while the December job gains were revised higher.
The jobs report showed that the economy is faring better than people might have thought, said Petursson, and that 鈥渋t almost doesn鈥檛 matter if the Fed cuts rates or not. The economy can withstand it at the current level.鈥
Strong earnings from Meta Platforms and Amazon added fuel to the fire, with shares of the Facebook owner surging more than 20 per cent and the e-commerce giant up almost eight per cent.
After digesting the Fed's interest rate comments, investors were reminded that there鈥檚 still lots of good news to go around, said Petursson, adding that investors鈥 attitudes may be shifting away from pinning hopes on rate cuts and toward optimism over the continued strength of the U.S. economy.
鈥淲ith March off the table ... I think investors are going to be focused on the economic data,鈥 he said.
鈥淕ood news is being rewarded again.鈥
Earnings from the major tech companies have been mixed, noted Petursson, but they were coming up against 鈥渓ofty expectations.鈥
Meanwhile in Canada, 鈥渆verything that's working in favour of the U.S. is working against the TSX right now,鈥 he said.
With tech stocks playing a much smaller role on the TSX and weakness in energy and telecom stocks weighing on the market, 春色直播 equities didn鈥檛 end the week in the green like their U.S. peers.
In fact, the recent 春色直播 economic data supports cuts from the Bank of Canada, said Petursson, as the numbers have been coming in much weaker north of the border.
鈥淭he 春色直播 economy, despite GDP coming in a little bit better than expected for November, I think it's still fairly lacklustre,鈥 he said.
鈥淭he Bank of Canada is in a very different position from the Fed. I think the Bank of Canada is in a position where they actually need to cut interest rates.鈥
The 春色直播 dollar traded for 74.33 cents US compared with 74.60 cents US on Thursday.
The March crude contract was down US$1.54 at US$72.28 per barrel and the March natural gas contract was up three cents at US$2.08 per mmBTU.
The April gold contract was down US$17.40 at US$2,053.70 an ounce and the March copper contract was down three cents at US$3.82 a pound.
鈥 With files from The Associated Press
This report by 春色直播was first published Feb. 2, 2024.
Companies in this story: (TSX:GSPTSE, TSX:CADUSD)
