(Toronto) Canada’s main stock index rose Friday, helped by gains in base metals, while Wall Street climbed modestly in the final day of a highly volatile week.
The S&P/TSX composite index rose 85.69 points to 22,311.30.
In New York, the Dow Jones industrial average rose 51.05 points to 39,497.54. The S&P 500 index rose 24.85 points to 5,344.16, while the NASDAQ composite index climbed 85.28 points to 16,745.30.
After an up-and-down week, “sometimes boredom is good,” said Macan Nia, co-chief investment strategist at Manulife Investment Management.
On Friday, the optimism from the previous day persisted as new jobs data helped provide some relief to the U.S. economy.
A jobs report last week helped fuel investor concern that news of economic weakness was no longer good news that would allow interest rates to be lowered, but simply bad news, Nia said. That was a major factor in Monday’s drop, he said.
U.S. markets ended the week slightly lower than they began, after indexes regained much of what they lost on Monday on Thursday.
The narrative that bad economic news could be a cause for concern rather than just further evidence of a coming rate cut is likely to continue through August, Mr Nia said – and he expects volatility to continue.
“Yes, the economic data is down, but an imminent recession or significant slowdown is probably not in the cards,” he said. “The U.S. economy is still resilient.”
Over the past week, market expectations for U.S. rate cuts have shifted, Nia noted, from a 25 basis point (0.25%) cut in September to 50 basis points (0.50%).
In Canada on Friday, the latest jobs report showed that the economy lost 2,800 jobs in May, while the unemployment rate remained at a 30-month high of 6.4%.
“This is just further evidence for the Bank of Canada that the Canadian economy is slowing, and it gives them the context to continue to cut the rate throughout the second half of the year,” Nia said.
The Canadian dollar was trading at 72.82 US cents compared to 72.76 US cents on Thursday.
Crude oil rose 65 US cents to US$76.84 per barrel and natural gas rose one US cent to US$2.14 per million BTU.
Gold jumped $10.10 to $2,473.40 an ounce and copper rose three cents to $3.99 a pound.