Canada’s main stock index edged up to a near five-week high on Thursday, as resource shares advanced ahead of U.S. and Canadian employment data that could guide expectations for central banks interest rate cuts.
The Toronto Stock Exchange’s S&P/TSX composite index ended up 20.35 points, or 0.1%, at 22,244.022, its highest closing level since May 31. Volumes were lighter than usual, with U.S. markets closed for Independence Day.
Canada and the U.S. are due on Friday to release employment data for June. Recent signs of a slowdown in the U.S. economy have led to increased bets the Federal Reserve would begin cutting rates as soon as September.
The Bank of Canada has already begun its easing cycle, lowering its benchmark rate by 25 basis points to 4.75% last month. Investors see a roughly 40% chance the BoC would cut again in July.
“The hopes of interest rate decreases have been very positive for the resource sector,” said Graham Priest, investment advisor at BlueShore Financial.
The materials group, which includes precious and base metals miners and fertilizer companies, was up 0.2%, adding to its 3.4% gain on Wednesday, which was its biggest advance this year.
Energy also gained ground, rising 0.3%, as the price of oil increased 0.2% to $84.06 a barrel, approaching its highest level in more than two months.
Suncor Energy Inc was not among the advancing stocks, ending nearly unchanged. The company has shut down its Firebag oil sands site as a precaution due to a wildfire about eight kilometers away, an Alberta government minister said.
Of the ten major sectors, only financials were down, dipping 0.1%.
Shares of consumer lending company goeasy Ltd slid 9.9% after the company announced its chief executive officer Jason Mullins will transition out of his role at year-end.
Reuters