Resources, retail sales weigh on TSX
Resources continued their downward trend Friday with oil settling below $40 and metals losing value too. There was some positive movement in stocks with 8 of the 10 subsectors of the main index gaining.
Wall Street had a better day with the S&P having its best week of 2015 so far and the Dow and Nasdaq also closing higher.
Asian markets closed their session mostly higher, led by the gains on Wall Street in the previous session.
Europe closed mostly higher on a dovish tone from the ECB.
The S&P/TSX Composite Index closed down 40.34 (0.30 per cent)
The Dow Jones closed up 91.06 (0.51 per cent)
Oil is trending mixed (Brent up at $44.46, WTI down at $39.39 at 4.30pm)
Gold is trending lower (1076.90 at 4.30pm)
The loonie is valued at U$0.7496
Liberals have inherited a $3 billion deficit
The Conservatives left a $3 billion deficit in the federal budget according to a fiscal update from the Liberal government. With stimulus measures planned a deficit is expected to a regular feature over the coming years. Finance Minister Bill Morneau said there would be a “challenging” road ahead but there will also be opportunity. Growth estimates for the economy have been revised down from the previous government’s forecasts in April; 1.2 per cent for this year (down from 2 per cent) and 2 per cent in 2016 (down from 2.2 per cent.)
Inflation holds steady at 1 per cent
October’s inflation figures from Statistics Canada showed a 1 per cent increase over the previous 12 months, matching that of September. Lower energy prices continued to moderate the year-over-year rise in the CPI, led by the gasoline index, which was down 17.1 per cent. Food continues to become more expensive with a 4 per cent increase in prices year-over-year compared to 3.5 per cent in the year to September. Recreation, education and reading was up 1.9 per cent while shelter increased 1 per cent.
Retail sales lower in September
Analysts surveyed by Bloomberg were expecting a 0.1 per cent increase in retail sales in September but official figures from StatsCan showed a decline of 0.5 per cent to $43.3 billion. The drop was led by lower gasoline sales (down 3.7 per cent) but when price changes are taken out overall retail sales were up 0.1 per cent. Year-over-year they were 1.2 per cent higher.