Daily Wrap-up: TSX closes higher despite 3 per cent drop for oil

TSX closes higher despite 3 per cent drop for oil... Poloz warning over fragile China... Canada’s net asset position down from record high...

Steve Randall
TSX closes higher despite 3 per cent drop for oil
The main index of the TSX closed slightly higher Wednesday following the sell-off in the previous session. Healthcare led the gains while energy firm stocks were the worst performers of the session, closing lower as oil prices took a 3 per cent drop.

Elsewhere the decline for oil led to a negative close for Wall Street, except the Nasdaq; European markets were lower with London bucking the trend; and Asian markets were generally lower.

Gold prices increased slightly as markets eased expectation for a Fed interest rate rise when it meets next week.
The S&P/TSX Composite Index closed up 17.36 (0.12 per cent)
The Dow Jones closed down 31.98 (0.18 per cent)
Oil it trending lower (Brent $46.05, WTI $43.69 at 5pm)
Gold is trending higher (1326.10 at 5pm)
The loonie is valued at U$0.7575
Poloz warning over fragile China
The Chinese economy poses the largest risk to Canada’s economic recovery, BoC governor Stephen Poloz has warned. He said that as the largest importer of resources, China’s fragile growth could spell further decline for the price of oil and other commodities.

The governor said that pressure on Canada’s economy would be exacerbated by current high levels of household debt.

Meanwhile, deputy governor Carolyn Wilkins said that investors and the financial community would need to adapt to lower interest rates and slower growth.
Canada’s net asset position down from record high
At the end of last year Canada’s net asset position was at a record high but that has eased in the first half of 2016.

Figures from Statistics Canada released Wednesday show the net foreign asset position decreased by $106.8 billion in the second quarter to $149.0 billion. This followed a decline in the first quarter.

Meanwhile, net international liabilities increased resulting in a decrease in Canada’s net asset position.

The stronger performance of the Canadian stock market relative to most major foreign stock markets was the main contributor to the decrease in the net foreign asset position in the second quarter.