Energy helps drive the TSX up; US markets muted ahead of Fed and earnings

Canada’s benchmark stock index rallied on Monday as strength in energy and financial stocks offset weakness in the resource-intensive materials and technology sectors.

The S&P/TSX Composite Index closed up 121.56 points, or 0.64%, at 19,104.48, Nutrien Ltd., Enbridge Inc. and Canadian Natural Resources Ltd. putting the most points on the tape.

GCM Mining Corp., which is not part of the composite index, posted a remarkable percentage gain on the Toronto Stock Exchange after announcing an all-stock friendly deal to acquire Aris Gold Corp. The companies said their transaction would create the largest gold company. in Colombia. Shares of GCM closed up 9.71% at $3.73 on Monday.

“The stock market likes the deal, and the shareholders we’ve spoken to like the deal, so we don’t foresee any problems getting votes on both sides,” Aris Gold Corporation chairman Ian Telfer said in a statement. an interview. .

Aris Gold’s Telfer says he has a hard-to-find Colombian gem

Gold industry veteran Ian Telfer, who becomes chairman of the combined company following the merger of GMC Mining and Aris Gold, says Aris’ big Soto Norte project in Colombia is a rare and attractive large-scale deposit

US markets struggled to find direction and ended mixed. The Dow gained 0.28%, the S&P 500 rose just 0.13% and the Nasdaq fell 0.43%.

It’s a busy week for investors as they await a string of earnings from several blue-chip companies, an interest rate decision from the US Federal Reserve and key economic data.

“The market will react quickly,” Martin Pelletier, senior portfolio manager at Wellington-Altus Private Counsel, said in an interview Monday.

He said the U.S. Fed may opt for a three-quarter point hike, instead of a full hike like the Bank of Canada, due to recent strength in the U.S. dollar. However, the Fed’s language on the future pace of rate hikes could move some segments of the market, he added.

“Then you also have inflationary data coming out of the US, GDP data which could also fuel expectations for future monetary policy, and then corporate earnings. I actually think there could be potential for upside surprise. So far, of the public companies that have reported, 75% have exceeded expectations and so that might be something to watch as well,” he said.

The risk of recession is limited, more upside for equities to come: Martin Pelletier

Martin Pelletier, senior portfolio manager at Wellington-Altus Private Counsel, joins BNN Bloomberg to explain why he isn’t worried about a recession and sees more potential for stocks ahead.

After Monday’s market close, Walmart Inc. announced it expects operating profit to decline 13-14% in the second quarter and 11-13% for the full year. The company said rising food and gasoline prices were affecting consumer spending habits and it was using discounts on general merchandise, particularly apparel, to shift inventory.

Walmart shares fell 8% immediately after the company announced the news.

Meanwhile, the September contract for US benchmark West Texas Intermediate crude rose US$2.00 to US$96.70 per barrel.

The Canadian dollar reached 77.82 cents US, a gain of 0.6%.

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