Oil jumps 6 per cent, markets close higher
Monday saw a situation which has been a rarity so far this year; all the major equity markets closed higher.
The rise in oil prices was the catalyst as US rig figures showed a decline and that news was enhanced by the secretary general of OPEC saying that the cartel is willing to work with non-OPEC producers to stabilize the market. West Texas Intermediate gained more than 6 per cent and the international benchmark Brent was up 5 per cent.
The main TSX index gained as energy and financials rose along with all but one of the major sectors. Pharmaceuticals was the loser, with Valeant weighing.
The S&P/TSX Composite Index closed up 32.23 (0.25 per cent)
The Dow Jones closed up 228.7 (1.40 per cent)
Oil is trending higher (Brent $34.69, WTI $31.43 at 4.40pm)
Gold is trending lower (1208.90 at 4.30pm)
The loonie is valued at $U0.7295
Federal government prepares for larger deficits
The federal government will reveal its budget on March 22 but we now know about more about what to expect. Finance minister Bill Morneau said Monday that there would be a deficit of $18.4 billion in the next fiscal year excluding previously announced spending plans. That could push the deficit to nearer $30 billion. In a speech in Ottawa Mr Morneau said that infrastructure spending is important amid the recently-lowered growth predictions for the economy.
IEA warns over potential “standstill” of Canadian oil growth
Oil production in Canada could slow down or even come to a halt according to the International Energy Agency. The agency said Monday that once current construction projects are completed “Heightened environmental concerns, a lack of pipeline access to new markets and the unknown impact of the victory by the New Democratic Party in Alberta’s elections last year are causing companies to slow development.” In the short term the IEA sees growth for Canadian production.
Decade high for venture capital investments
Canadian startups had a bumper year in 2015 according to the Canadian Venture Capital & Private Equity Association. There were 536 deals totaling $2.25 billion in 2015, a ten-year high. The tech space was particularly buoyant and life-sciences saw a sharp rise.