Currency traders watch computer monitors near the screens showing the Korea Composite Stock Price Index (KOSPI), left, and the foreign exchange rate between U.S. dollar and South Korean won at a foreign exchange dealing room in Seoul, South Korea, Thursday, April 20, 2023. THE CANADIAN PRESS/AP-Lee Jin-man
TORONTO – Canada’s main stock index gained more than 100 points Friday on strength in the energy sector, while U.S. indexes also rose to cap off a volatile week in North American markets.
The S&P/TSX composite index was up 113.90 points at 20,636.54.
In New York, the Dow Jones industrial average was up 272 points at 34,098.16.The S&P 500 index was up 34.13 points at 4,169.48, while the Nasdaq composite was up 84.35 at 12,226.58.
New GDP data Friday helped justify the Bank of Canada’s continued interest-rate pause, said Ashish Utarid, assistant vice-president of investment strategy at IG Wealth Management.
The data showed that economic growth in Canada is cooling, with Statistics Canada saying the economy grew by 0.1 per cent in February, compared with 0.6 per cent growth in January.
Utarid said the Bank of Canada is still hoping for a “Goldilocks” scenario, where inflation cools without sending the economy into a recession.
“In Canada, we’re in a better position, because we’ve got oil propping up the economy, and contributing to positive economic outlook,” said Utarid. “But interest rates are keeping the economy from growing further, and the fight for inflation almost seems to be won.”
That Goldilocks scenario may be less likely in the U.S., he said, where markets are more subject to the volatile swings of major tech stocks.
A handful of big companies have been largely responsible for market moves so far this year as well as this past week, said Utarid.
Such companies are among those that reported results this week as U.S. earnings season was in full swing, with some of the biggest names beating expectations.
On Friday, Exxon Mobil and Intel both reported better results than expected, helping offset Amazon share prices, which fell after the company reported a slowdown in revenue growth in its AWS cloud computing business.
Also in the U.S., the core inflation index which is closely followed by the central bank rose 4.6 per cent on an annual basis in March, much higher than the target rate of two per cent.
All eyes will be on the Federal Reserve next week, said Utarid. The central bank is widely expected to raise its key interest rate by another quarter of a percentage point, but what they say about the decision and future decisions will be of great interest to investors, he said.
The Canadian dollar traded for 73.65 cents UScompared with 73.46 cents US on Thursday.
The June crude contract was up US$2.02 at US$76.78 per barrel and the June natural gas contract was up six cents at US$2.41 per mmBTU.
The June gold contract was up 10 cents at US$1,999.10 an ounce and the July copper contract was up a penny at US$3.89 a pound.
– With files from Associated Press
This report by The Canadian Press was first published April 28, 2023.
Companies in this story: (TSX:GSPTSE, TSX:CADUSD=X)
