S&P/TSX composite adds 120 points on strength in energy, metals, U.S. markets also up
TORONTO — Strength in the base metal and energy sectors helped lead Canada's main stock index higher Monday ahead of Tuesday's inflation data release, while U.S. markets also ticked upwards.
The S&P/TSX composite index was up 120.35 points at 20,539.97.
In New York, the Dow Jones industrial average was up 47.98 points at 33,348.60.The S&P 500 index was up 12.20 points at 4,136.28, while the Nasdaq composite was up 80.47 points at 12,365.21.
Monday on the markets was “a quiet day, but on the whole tilted a little bit more optimistic,” said Mona Mahajan, senior investment strategist with Edward Jones.
“I think there's a bit of wait-and-see ahead of tomorrow's meeting around the debt ceiling talks,” she said.
President Joe Biden is set to meet with House Speaker Kevin McCarthy and other congressional leaders Tuesday. McCarthy said Monday there’s been “no progress” on the standoff over the debt limit.
But Mahajan noted that the U.S. government has raised the debt ceiling many times.
“There's a precedent for both sides of Congress to come together in a last-minute format,” she said.
Also coming Tuesday are economic releases in both Canada and the U.S.
Canadian price data is expected to show a steady decline in both headline and core inflation, said Mahajan.
Recent inflation data out of the U.S. showed better than expected headline inflation and indications that core inflation is stabilizing too — “I think most investors would like to see the same thing in Canada,” she said.
Meanwhile, retail sales data out of the U.S. alongside earnings from some major retail firms will give insight into how the consumer is faring, she said.
Overall, recent trends have been heading in the direction of stabilization, whether it’s energy prices, used car prices, supply chain pressures, housing or labour, said Mahajan.
“All of those combined lead us to believe that … inflation will be headed lower in the month ahead, both in the U.S. and Canada,” she said, adding that it seems feasible to expect inflation will be between three and three and a half per cent by the end of the year.
The Canadian dollar traded for 74.15 cents US compared with 73.89 cents US on Friday.
The June crude contract was up US$1.07 at US$71.11 per barreland the June natural gas contract was up 11 cents at US$2.38 per mmBTU.
The June gold contract was up US$2.90 at US$2,022.70 an ounce and the July copper contract was up two cents at US$3.75 a pound.
— With files from The Associated Press
This report by The Canadian Press was first published May 15, 2023.
Companies in this story: (TSX:GSPTSE, TSX:CADUSD=X)
Rosa Saba, The Canadian Press