July 3, 2022

DS Duke

Global Business In World

TSX Finds Upward Momentum by Wednesday Close

4 min read
Equities in Toronto pulled out of the dungeon in which they’d spent much of the...

Equities in Toronto pulled out of the dungeon in which they’d spent much of the day, and strode toward Wednesday’s finish solidly in the green, mostly on the strength of utility and health-care stocks.

The S&P/TSX Composite surged 120.59 points to close the midweek session to 20,769.16.

The Canadian dollar jumped 0.17 cents at 77.89 cents U.S.

WELL Health climbed 14 cents, or 2.9%, to $5.02, while Bausch Health Companies jumped 87 cents, or 2.8%, to $32.34.

In the tech sector, HUT 8 Mining acquired 62 cents, or 5.9%, to $11.05, while BlackBerry took on 40 cents, or 3.6%, to $11.46.

In utilities, ATCO Ltd. gained $1.02, or 2.5%, to $42.65, while Hydro One moved ahead 68 cents, or 2.2%, to $32.18.

Gold and other resource stocks were a different matter, however, with NovaGold sagging 34 cents, or 3.9%, to $8.49, while New Gold dropping nine cents, or 5.1%, to $1.68.

Turquoise Hill Resources took it squarely on the chin, $1.59, or 7.6%, to $19.21, while Lundin Mining lost 34 cents, or 3.1%, to $10.56.

Communication stocks also took a hit, with Corus Entertainment off six cents, or 1.3%, to $4.45, while Rogers down 92 cents, or 1.6%, to $57.09.

On the economic beat, Statistics Canada reported that Canada’s annual inflation rate remained at 4.7% in November, an 18-year high, amid the continued impact of supply chain disruptions.

As well, the agency reported manufacturing sales rose 4.3% in October, on higher sales of motor vehicles and motor vehicle parts. Excluding these two industries, manufacturing sales increased 1.7%.

Canada Mortgage and Housing Corporation reported Wednesday that housing starts rose to 301,279 units in November, beating analyst expectations of 234,300 starts, and up from a revised 238,366 units in October.

Finally, national home sales rose 0.6% on a month-over-month basis in November, according to the Canadian Real Estate Association.

CBC News is reporting Canada is expected to toughen restrictions on international travel with new measures to be announced on Wednesday as it looks to limit the spread of the Omicron coronavirus variant.

Canada on Tuesday cut its deficit forecast for this fiscal year and pledged new funds to fight the Omicron coronavirus variant, while spending promised in this year’s election campaign would likely be put in a full budget early next year.

ON BAYSTREET

The TSX Venture Exchange gained 1.65 points to 879.31

Eight of the 12 TSX subgroups were higher on the day, with health-care haler 1.7%, information technology stronger 1.3%, and utilities better by 1%.

The four laggards were weighed most by gold, down 1.3%, materials sinking 0.4%, and communications off 0.3%.

ON WALLSTREET

U.S. stocks cut their losses and moved higher on Wednesday as the market got past one of the big uncertainties heading into year-end. The Federal Reserve signaled a more aggressive unwinding of its monthly bond buying, as expected by the market, and forecast multiple rate hikes on the way next year.

The Dow Jones Industrials climbed 383.25 points, or 1.1%, to glide to the finish at 35,927.43,

The S&P 500 index grabbed 75.76 points, or 1.6%, to 4,709.85.

The NASDAQ raced higher 327.94 points, or 2.2%, at 15,565.58.

Shares of Apple rose nearly 3%, lifting the market averages and continuing the stock’s recent momentum. Other Big Tech stocks like Microsoft and Netflix also moved higher. Wednesday’s moves marked a reversal from earlier this week, when the NASDAQ underperformed on Monday and Tuesday.

Defensive plays also performed well, with health care stocks such as UnitedHealt, up 3.1% and Amgen rising 2.6%.

Big banks, however, were lower even after the Fed signaled multiple rate hikes are on the way.

JPMorgan and Bank of America shares were lower. Some regional bank stocks, including Comerica, saw modest gains.

The Fed announced on Wednesday that it would wind down its asset purchases, a process known as tapering, at a faster pace amid a continued rise in inflation. The Fed will be buying $60 billion per month of bonds starting in January, down from December’s rate of $90 million, and said that it will likely continue that trajectory in the months ahead.

The move comes as the central bank is grappling with the highest inflation level in nearly four decades. The Fed was widely expected to accelerate its taper this month.

This sets the stage for a dramatic policy shift that will clear the way for a first interest rate hike next year. The central bank signaled on Wednesday that its members see three hikes in 2022.

JPMorgan and Bank of America shares were lower. Some regional bank stocks, including Comerica, saw modest gains.

Meanwhile, shares of Apple rose more than 2%, lifting the market averages and continuing the stock’s recent momentum. Other Big Tech stocks like Microsoft and Netflix rose after sliding on Tuesday.

Defensive plays also performed well, with health care stocks such as UnitedHealth and Amgen also rose more than 2%.

Retail sales for November came in worse than expected, rising 0.3% month-over-month. Economists surveyed by Dow Jones were looking for a 0.8% month.

Prices for 10-year Treasurys sagged, raising yields to 1.46% from Tuesday’s 1.44%. Treasury prices and yields move in opposite directions.

Oil prices regained 84 cents to $71.57 U.S. a barrel.

Gold prices recovered $6.30 to $1,778.60 U.S. an ounce.

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