Positivity returns as oil rebounds 2 per cent
Energy stocks staged a comeback Thursday as oil prices rebounded more than 2 per cent.
The situation is likely to be short-lived though as it is looking like the UN nuclear inspectors could confirm Friday that Iran has complied with the deal with the West, paving the way for Iranian oil exports to join the global supply glut.
Wall Street joined Toronto in closing higher but the rest of the world was less optimistic. Asian stocks closed mostly lower, before the oil rebound, with only Shanghai closing higher after a sell-off in the previous session.
European markets closed lower too with regional corporate earnings in focus.
TSX Composite Index closed up 165.5 (1.36 per cent)
The Dow Jones closed up 227.2 (1.41 per cent)
Oil is trending higher (Brent $31.00, WTI $31.10 at 4.05pm)
Gold is trending lower (1077.40 at 4.05pm)
The loonie is valued at U$0.6967
Trudeau grit? PM upbeat on economy
The Prime Minister sounded an upbeat tone Thursday as he visited Google’s offices in Ontario. Justin Trudeau told reporters that he was “optimistic” that the economy will grow despite challenging conditions and stated that although there is “work to do” he is confident in his government’s ability to do it. He commented that Canada must move away from having all its “eggs in one basket” and diversify from an economy overly reliant on oil.
Tough half year for Alberta says ATB
ATB Financial’s economist Todd Hirsch is predicting six months of tough economic conditions for Alberta as oil prices continue to drag. He said that consumers will be spending less with retailers and the housing market will be weak as jobs continue to be lost in areas such as Calgary and Fort McMurray. Hirsch believe that it will take until late in the year for oil prices to increase.
Rosenberg calls for large federal deficit
Ottawa should run with a higher deficit according to Gluskin Sheff’s chief economist David Rosenberg. He believes that the Liberal government should more than double the $10 billion annual deficits it pledged during the election campaign. Rosenberg says that $24 billion through 2020 would still keep Canada’s debt-to-GDP ratio below the average OECD nations’ 70 per cent.