TORONTO — Canada’s main stock index more than recovered Wednesday’s losses as it gained more than one per cent in trading Thursday, while U.S. markets also rebounded.
The S&P/TSX composite index was up 201.79 points at 19,485.89. Almost every major sector on the TSX saw gains of almost one per cent or higher, with energy rising 1.32 per cent, financials 1.27 per cent, information technology 3.06 per cent, and health care 2.76 per cent.
In New York, the Dow Jones industrial average was up 345.09 points, or 1.05 per cent, at 33,220.80. The S&P 500 index was up 66.06 points, or 1.75 per cent, at 3,849.28,while the Nasdaq composite was up 264.80 points, or 2.59 per cent, at 10,478.09.
After a dismal Wednesday that saw the Nasdaq break new lows, Thursday marked a change in tone for the week, said Stephen Duench, vice-president and portfolio manager for AGF Investments Inc.
There were a few factors contributing to the gains, he said. One is new jobs data in the U.S. that hinted at the labour market cooling based on rising unemployment benefit applications; nothing dramatic, but any sign that the Federal Reserve’s rate hikes have been working is good news for investors, Duench said.
China has been the source of a rollercoaster of reaction for markets, which have been optimistic about the country relaxing its COVID rules but less positive about rising cases. Some countries are imposing testing requirements for visitors from China.
“There’s been a push-pull on the China COVID front … but at least today it was more in the positive hue,” said Duench.
December has been an unseasonably bad month on the markets, Duench said.
December has been a month for selling off losses, said Duench, with the last day for tax-loss selling in Canada on Wednesday. So investors may have made many of their loss sales already, which means positioning may be more positive for the last day of the trading year.
Historically, more volatile or down years see more pronounced selloffs near the end of the year, said Duench.
Volatility will continue in 2023, he said, and investors will be looking for any sense of what’s coming in the economic data, which will help answer some of the unanswered questions about central banks’ interest-rate decisions in the coming months.
The Canadian dollar traded for 73.76 US compared with 73.72 cents US on Wednesday.
The February crude contract was down 56 cents at US$78.40 per barrel and the February natural gas contract was down 13 cents at US$4.56 per mmBTU.
The February gold contract was up US$10.20 at US$1,826.0 an ounce and the March copper contract was down two cents at US$3.82 a pound.
This report by The Canadian Press was first published Dec. 29, 2022.
Companies in this story: (TSX:GSPTSE, TSX_CADUSD=X)
