TSX closes higher but loses over the week
There was a positive end to the session for the main TSX index Friday despite the largest monthly drop in GDP since 2009; but it snapped the recent run of weekly wins, closing 0.1 per cent lower from Monday.
Resources stocks helped the gains for the session as oil and gold prices rebounded following recent losses.
Wall Street closed mixed as markets reacted to weak growth south of the border with GDP at 1.2 per cent for the second quarter, less than half the expected figure. The Dow closed lower but there were gains for the S&P500 and the Nasdaq as Amazon and Alphabet shares gained.
The poor US GDP data was seen as good news in Europe where markets gained on expectation that the Fed will delay interest rates even further, and on mixed regional earnings.
Asian markets had closed mixed following the BoJ’s disappointing stimulus package.
The S&P/TSX Composite Index closed up 30.00 (0.21 per cent)
The Dow Jones closed down 24.11 (0.13 per cent)
Oil is trending mixed (Brent down at $42.49, WTI up at $41.46 at 4.50pm)
Gold is trending higher (1357.80 at 4.50pm)
The loonie is valued at U$0.7658
GDP down 0.6 per cent as wildfires hit producers
Canada’s GDP fell 0.6 per cent in May as the Fort McMurray wildfires took their toll on goods-producing industries. The drop was the largest monthly decline since 2009 and was larger than the 0.4 per cent analysts had expected.
Statistic Canada reported that the goods producers’ sector contracted by 2.8 per cent led by a 6.4 per cent drop in the oil and natural gas extraction industry.
Manufacturing was down 2.4 per cent, utilities down 1.8 per cent and construction down 0.7 per cent; while real estate, finance and insurance, and retail trade made small gains and wholesale trade was up 1 per cent.
Ottawa’s surplus slashed to $114 million
Canada’s federal budget recorded a far smaller surplus in April and May than the same period last year. Ottawa had a $114 million surplus this year compared to April and May 2015’s $3.95 billion.
Sales tax and duties were lower and despite higher income tax receipts the overall revenue was down 2.1 per cent.
Air Canada exceeds expectations with quarterly earnings
A 22 per cent drop in fuel costs helped Air Canada report adjusted earnings of 72 cents per share, exceeding the 58 cents that analysts had been expecting.
Net earnings were down to 66 cents per share from $1 a year earlier and revenue was down 1.3 per cent to $3.52 billion. Costs increased partly due to the lower value of the loonie.
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