TORONTO – Canada’s main stock index rose slightly on Tuesday, while US markets have weakened after sharp gains since last month’s lows.
The S & P / TSX composite index closed up 21.44 points to 13,614.14 after reaching an intraday high of 14,062.71.
In New York, the Dow Jones industrial average was down 26.13 points to 22,653.86 after increasing 937 points in previous trade and more than 1,600 points Monday.
The S&P 500 index lost 4.27 points to 2,659.41, while the Nasdaq composite lost 25.98 points to 7,887.26.
“This gathering was very large yesterday and today may be more like digesting,” said Sid Mokhtari, executive director of institutional equity research at CIBC.
Markets in Canada and the United States have risen more than 21% since the low on March 23 after a sharp drop as investors reacted to the economic impact of the spread of COVID-19.
“The liquidation we had in March was the fastest 30% withdrawal in history, so this rebound, which comes at least on the basis of historical observation, is not a surprise,” he said. he said in an interview.
Mokhtari said that investors were cautious and awaited the start of corporate profits since the historical outlook on how companies have handled past challenges is not very useful with much of the economy down.
“I think it’s important that this market can pause as we move forward given that we don’t have a lot of direction and given that the economy has stopped during last month, “said Mokhtari.
Markets rose to start the week hoping that growth in cases of the new coronavirus would decrease or flatten in Europe and New York.
He said the market movement predicted that “maybe the bulk of the damage is behind us”.
On Tuesday, the daily death toll in New York reached its highest level.
The Canadian dollar traded at 71.50 US cents, the highest level in about three weeks, compared to an average of 70.79 US cents on Monday.
Real estate, consumer discretionary and finance were the best sectors of the day. Industrial products were pushed up by a 14.8% gain in Chorus Aviation shares and a 9.3% increase in Air Canada.
Materials underperformed due to lower gold prices. It declined 1.3%, Alacer Gold Corp. and B2Gold Corp. losing 6.3% and 5.3% respectively.
The June gold contract fell US $ 10.20 to US $ 1,683.70 an ounce and the May copper contract rose 5.5 cents to US $ 2.27 per pound.
Energy also declined due to a 9.3% drop in crude oil prices.
The May crude oil contract fell US $ 2.45 to US $ 23.63 per barrel and the May natural gas contract increased 12 cents to US $ 1.85 per mmBTU.
Suncor Energy Inc. fell 3.8% and Baytex Energy Corp. fell 2.3%.
Energy prices had risen in the hope that an agreement would be reached between Russia and OPEC to cut production by up to 15 million barrels a day.
They fell after the meeting was postponed to Thursday. Despite the expected production cuts, there is a global glut of oil as global demand remains weak, said Mokhtari.
“As long as we do not increase demand, it is reasonable to say that the volatility of the oil market should stay here for a while.
This report from The Canadian Press was first published on April 7, 2020.
Companies in this story: (TSX: SU, TSX: BTE, TSX: CHR, TSX: AC, TSX: ASR, TSX: BTO, TSX: GSPTSE, TSX: CADUSD = X)
Ross Marowits, The Canadian Press