A general view of the TSX Broadcast Centre in Toronto.MARK BLINCH/Reuters
Stocks recovered some lost ground on Friday, a day after a pile-up of dismal economic news sent major indexes to some of their worst one-day declines this year.
The Dow Jones industrial average closed at 12,640.86, up 67.29 points or 0.5 per cent. The broader S&P 500 closed at 1335.02, up 9.51 points or 0.7 per cent. In Canada, the S&P/TSX composite index closed at 11,435.54, up 27.22 points or 0.2 per cent.
The gains follow what could have been another major setback for investor sentiment: On Thursday evening, after markets closed, Moody's Investors Service cut credit ratings on 15 of the world's largest banks, including Bank of America Corp., Morgan Stanley, Citigroup Inc. and even Royal Bank of Canada.
Yet, financial stocks were among the top performers on Friday, responding to the downgrades with what looked to be defiance. Royal Bank rose 1.2 per cent and Bank of America rose 1.5 per cent – suggesting that the Moody's downgrade had been well-telegraphed by the credit rating agency's warning issued in mid-February. As well, the actual downgrades might have come with some relief, given that they weren't as harsh as some observers had been expecting.
Commodity prices also showed some tentative strength, after hammering commodity producers during Thursday's selloff. Crude oil, which fell to its lowest level since October, rose to $79.80 (U.S.) a barrel, up $1.60. Gold's gains were more muted: It rose to $1,566.90 an ounce, up $1.60.
Among energy producers Suncor Energy Inc. rose 2 per cent and Canadian Natural Resources Ltd. rose 1.5 per cent. However, gold producers continued to struggle: Barrick Gold Corp. fell 1.7 per cent and Goldcorp Inc. fell 0.9 per cent.
David Berman