At midday: TSX inches higher as cannabis stocks reverse course
Canada’s main stock index sat flat on Friday as cannabis companies reversed early losses and jumped higher.
At 11:35 a.m. ET, the Toronto Stock Exchange’s S&P/TSX composite index was up 15.82 points, or 0.09%, at 18,408.81.
The healthcare sector was up 3.5%, led by a 10.6% rise in Aphria Inc. and 2.9% increase in Canopy Growth Corp.
Energy stocks were up 0.3% as oil prices edged higher on Friday, buoyed by hopes for a U.S. stimulus bill, but a weaker demand outlook from OPEC and the International Energy Agency capped gains.
Brent crude was up 38 cents, or 0.6%, at $61.52 a barrel having dropped to a session low of $60.35 earlier. U.S. oil was up 22 cents, or 0.4%, at $58.46 after falling to a session low of $57.41.
U.S. crude was on track for a weekly gain of about 2.8% while Brent was set for a 3.6% rise on the week.
The materials sector also gained 0.3% with gold recovering earlier losses to steady on Friday as the U.S. dollar pulled back from session highs, while platinum was headed for its biggest weekly rise since March 2020 on expectations for a revival in auto sector demand.
Spot gold was up 0.1% at $1,826.41 per ounce, off an earlier low of $1,809.70. U.S. gold futures were also up 0.1% at $1,828.30.
The macro backdrop remains supportive, with gold prices “likely to resume their uptrend in coming weeks given our expectations for the dollar to weaken further alongside real yields remaining low or negative,” said Standard Chartered analyst Suki Cooper.
U.S. stocks remained mixed in early trading on Friday, following the highs the market set the day before. The market remains focused on trillions of dollars of potential government aid that could be coming for the economy, as Democrats move forward with their stimulus package.
The S&P 500 index was up 0.2%. The Dow Jones Industrial Average was mostly unchanged and the Nasdaq Composite was also mostly unchanged. The Russell 2000 index of small companies was down 0.3%.
The indexes were wavering between gains and losses in the first 90 minutes of trading, with little movement beyond a couple tenths of a per cent in either direction.
Investors are hoping for a new round of U.S. government aid as the economic recovery falters. The latest U.S. government report on jobless claims reaffirmed that employment remains a weak spot in the economy, even as vaccine distribution ramps up in the hopes of eventually ending the pandemic. The University of Michigan survey of consumer sentiment came in well below expectations as well, a sign that consumers are wary to spend in the face of economic uncertainty.
Investors do not expect the market to move substantially higher in the near term until there’s more clarity on the future of government stimulus and the direction of the U.S. economy. Democrats have decided to use a legislative process that does not require Republican support to pass the $1.9 trillion package.
Mohawk Industries shares jumped nearly 10% after the company posted stronger-than-expected quarterly earnings.
Bumble shares rose a further 12%, extending big first-day gains Thursday on the company’s initial public offering.
Most Asian markets were closed to mark the Lunar New Year.
Reuters and The Associated Press
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