S&P/TSX Composite Listed Lower Friday on Energy Weakness, US Markets Mixed

TORONTO – Canada’s leading stock was trading lower Friday, led by losses in the energy sector, while US markets were mixed.

The S&P/TSX composite index fell 15.57 points to 20,262.07.

In New York, the Dow Jones industrial average rose 113.89 points to 34,509.03. The S&P 500 index fell 4.62 points to 4,505.42, while the Nasdaq index fell 24.87 points to 14,113.70.

Markets got off to a fairly strong start after several major US banks and other companies reported encouraging results to kick off the earnings season, said Ian Chong, associate portfolio manager for First Avenue Investment Counsel Inc.

“The banks were absolutely central, JPMorgan, Wells Fargo and Citi,” said Chong. “They all reported strong results and beat consensus estimates, particularly on net interest income.”

By midmorning, however, markets began to slide lower as more details about earnings dampened investor optimism, Chong said, such as concerns that consumer spending could weaken on rising household debt, and that some consumers are falling behind on credit. card payments.

“That was a bit of a mixed bag,” he said, though he noted that it was still more positive than negative.

“All things considered, it was a pretty strong start to the second quarter reporting period,” Chong said, but “economic data continues to dominate the day.”

Investors were also weighed down by the latest University of Michigan consumer confidence survey, which showed consumer confidence rising while inflation expectations also ticked slightly higher.

The Federal Reserve is closely monitoring inflation expectations, Chong said, and doesn’t want higher expectations baked into the longer-term outlook.

“What that told me was that if consumer confidence is still relatively strong and inflation expectations start creeping up, the Fed will probably continue to hike,” he said — and while another hike is already priced in, the Fed is probably also to keep rates high for longer.

The “higher longer” theme was also felt across the border, with higher manufacturing sales and some strength in the housing market, Chong said.

“The Bank of Canada could very well move again,” he said.

The TSX was also dragged lower by energy stocks as the price of oil fell more than two percent.

The Canadian dollar traded at 75.86 US cents compared to 76.17 on Thursday.

The August crude oil contract was down US$1.47 to US$75.42 per barrel and the August natural gas contract was down US$2.54 per mmBTU.

The August gold contract was up 60 cents to US$1,964.40 an ounce and the September copper contract was down less than a cent to US$3.93 an ounce.

This report from The Canadian Press was first published on July 14, 2023.

Companies in this story: (TSX:GSPTSE, TSX:CADUSD=X)

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