The Toronto stock market registered a modest gain near the end of a lacklustre week as concerns about monetary stimulus from the Federal Reserve helped weigh on the TSX.
The S&P/TSX composite index rose 12.18 points to 13,487.51, led by gold stocks which have fallen heavily this week.
The Canadian dollar was off the worst levels of the morning amid data showing a better than expected read on retail sales and very low pressure on prices.
The loonie was down 0.08 of a cent to 94.97 cents U.S. as Statistics Canada reported that October retail sales rose one per cent, much higher than the 0.3 per cent gain that economists had expected. But excluding autos, sales were flat against an expected 0.2 per cent rise.
On the inflation front, the agency reported that consumer prices rose at an annual rate of 0.7 per cent in October, down from 1.1 per cent in September and lower than the 0.9 per cent rate that was expected. The dollar rose and global equity markets edged higher on Friday at the end of a volatile week driven by worries, now dissipating, that the Federal Reserve will soon start to wind down its economic stimulus.
Volatility eased as investors took the view that a Fed move to scale back its bond-buying, probably in the first three months of next year, does not necessarily mean official interest rates will rise soon afterward.
In the lingo of Wall Street, to taper is not to tighten.
Even after the U.S. central bank starts to scale back its stimulus, monetary policy is likely to be very accommodative for some time, perhaps for years, Atlanta Fed President Dennis Lockhart said on CNBC on Friday.
“The Fed will not start to taper until the economy is able to walk on its own; that’s a positive,” said Phil Orlando, chief equity market strategist at Federated Investors, in New York.
“From a catalyst perspective things are calm; we’re sitting just off record highs and in the near term we’re probably fairly valued.”
MSCI’s all-country world equity index, which tracks shares in 45 countries, rose 0.31 per cent.
On Wall Street, the Dow Jones industrial average rose 15.64 points or 0.1 per cent, to 16,025.63, the S&P 500 gained 4.61 points or 0.26 per cent, to 1,800.46 and the Nasdaq Composite added 16.083 points or 0.41 per cent, to 3,985.238.
Ontario won a key battle Friday in its crusade to clamp down on ever-increasing health-care costs, as Canada’s top court upheld a ban on big pharmacies selling their own private-label generic drugs.
In a 7-0 decision, the justices said the province’s 2010 decision to outlaw the practice was consistent with its efforts to ensure transparent drug pricing.
Shoppers Drug Mart issued a short statement, saying while it respects the Supreme Court of Canada’s decision, “it is disappointed with the outcome.”
The law was an attempt by the deficit-strapped government to cut health-care costs. It also eliminated so-called “professional allowances” that generic drug companies paid to pharmacies in exchange for stocking their products.
With files from Reuters