Canadian lumber companies and gold miners gained and the country's biggest marijuana producers fell sharply on Friday, leaving the main Toronto equity index slightly higher on the day but down for the week.
The Toronto Stock Exchange's S&P/TSX composite index ended up 21.24 points, or 0.13 per cent, at 16,308.18. It lost 0.25 per cent over the course of the week, after three weeks of gains.
The heavyweight materials group, which includes precious and base metals miners and fertilizer companies, added 1.4 per cent.
Among the most influential gainers on the index were two of the world's largest gold producers, with Barrick Gold Corp. gaining 2.8 per cent to $18.88 (Canadian) and Goldcorp Inc. up 2.6 per cent to $17.89 as gold futures rose 1.3 per cent to $1,338.20 (U.S.) an ounce.
Lumber companies, whose softwood products are the subject of a trade spat between Canada and the United States, also advanced, with Canfor Corp. up 5.6 per cent to $27.19 and West Fraser Timber Co. rising 5.4 per cent to $84.83.
Cannabis companies, which have risen sharply as they race to prepare for Canada's legalization of recreational use, extended a recent pullback. Aphria Inc. fell 112.3 per cent to $18.02 and Canopy Growth Corp. was down 13.9 per cent to $32.35.
An influx of global capital pushed many cannabis producers to record highs over the last few weeks and investors have since been booking profits, said PI Financial analyst Jason Zandberg. "Canada is a very small market on the global scene, yet it is the only really legitimate place for cannabis companies," he said. "The weight of capital into the relatively tiny market in Canada can create waves on both the upside and downside."
The energy group added 0.3 per cent, with Peyto Exploration and Development Corp. adding 4.3 per cent to $13.76 after saying it will cut its 2018 capital budget and dividend payouts.
The Canadian dollar advanced against its broadly weaker U.S. counterpart on Friday as oil prices climbed and chances rose that the Bank of Canada will raise interest rates next week.
The Canadian dollar was up 0.38 of a cent to 80.18 cents (U.S.). For the week, the loonie lost 0.5 per cent. Investors took the view that the Bank of Canada will hike on Jan. 17 despite a more uncertain outlook for the North American Free Trade Agreement.
Wall Street continued its rally on Friday with record closing highs as fourth-quarter earnings season kicked off with solid results from banks and robust retail sales drove investor optimism about economic growth.
The Dow Jones Industrial Average rose 228.46 points, or 0.89 per cent, to 25,803.19, the S&P 500 gained 18.68 points, or 0.67 per cent, to 2,786.24 and the Nasdaq Composite added 49.29 points, or 0.68 per cent, to 7,261.06.
The S&P 500 and Nasdaq both registered their eight record closing highs out of the first nine trading days of 2018, while the Dow boasted its sixth closing high of the year.
U.S. stocks rose with bank shares, which climbed following quarterly results from JPMorgan Chase & Co. and Wells Fargo.
The U.S. dollar slumped to a more than three-year low against the euro on Friday, extending recent losses on expectations European Central Bank policymakers are preparing to reduce their stimulus.
The euro's rise weighed on the dollar index, which measures the greenback against six rival currencies. The index was down 0.94 per cent, after slipping to a four-month low of 90.954.
JPMorgan, the biggest U.S. lender by assets, said a U.S. tax overhaul would help future profits by reducing its tax bill and stimulating more business. The bank's shares rose 1.7 per cent.
"The fact all the big money centre banks beat on the bottom line is a good omen for the rest of the earnings season," said William Lynch, director of investments at Hinsdale Associates, in Hinsdale, Illinois.
Investors were also hopeful 2018 financial forecasts from U.S. companies would beat Wall Street estimates as many analysts may not have tax savings fully reflected in their models as the tax bill was signed into law so late in December.
"I don't know how much of that is priced in right now," said Stephen Massocca, senior vice-president at Wedbush Securities in San Francisco. "It seems like the economy is going OK, inflation is kind of nonexistent right now, wage growth is not an issue for most income statements, so what's not to like here."
Earnings for S&P 500 companies are expected to increase on an average by 12.1 per cent in the quarter, with profit for financial services companies likely to increase 13.2 per cent, according to Thomson Reuters I/B/E/S.
BlackRock rose 3.3 per cent. The world's largest asset manager reported profit that beat estimates as investors flooded into the relatively low-cost funds.
While Wells Fargo earnings beat expectations, its shares slipped 0.7 per cent after it set aside $3.25-billion in the fourth quarter to cover legal expenses related to probes into its mortgage and sales practices.
For the week, the S&P rose 1.6 per cent, compared with the Dow's 2-per-cent rise and a 1.8-per-cent advance in the Nasdaq.
The S&P consumer discretionary index jumped 1.3 per cent after retail sales data showed households bought more goods, suggesting the economy exited 2017 with strong momentum.
Amazon rose 2.2 per cent to breach $1,300 for the first time. It closed at $1,305.20.
The sector was also helped by a late-afternoon Bloomberg report that activist D.E. Shaw built a position in Lowe's Companies, sending its shares up 5.3 per cent.
Bank stocks were helped by a rise in Treasury yields after underlying U.S. consumer prices for December posted the biggest gain in 11 months, signalling a pickup in inflation.
The Treasury move helped push the utilities sector down 0.6 per cent, making it the weakest performer of the S&P 500's 11 sectors.
Advancing issues outnumbered declining ones on the NYSE by a 1.17-to-1 ratio; on Nasdaq, a 1.54-to-1 ratio favoured advancers.
The S&P 500 posted 164 new 52-week highs and 12 new lows; the Nasdaq Composite recorded 222 new highs and 14 new lows.
Volume so far on U.S. exchanges was 6.88 billion shares, above the 6.39 billion average for the full session over the last 20 trading days.