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Equities

Canada’s main stock index started higher early Monday with energy stocks gaining alongside the continued rally in crude prices. South of the border, Wall Street’s main indexes hit record highs on optimism over a COVID-19 relief package.

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At 9:32 a.m. ET, the Toronto Stock Exchange’s S&P/TSX composite index was up 134.71 points, or 0.74 per cent, at 18,270.61.

In the U.S., the Dow Jones Industrial Average rose 43 points, or 0.14 per cent, at the open to 31,191.2. The S&P 500 rose 5.8 points, or 0.15 per cent, at the open to 3,892.59, while the Nasdaq Composite rose 80.8 points, or 0.58 per cent, to 13,937.06 at the opening bell.

“Friday’s disappointing U.S. jobs report doesn’t appear to have dimmed investor appetite for equities, on the contrary, the fact that the report fell short has raised expectations that we’ll see the full US$1.9-trillion stimulus package make its way through both houses,” CMC chief market analyst Michael Hewson said.

“Some on the Republican side still appear determined to water down the size of the Democrats’ plan, along perhaps with some more hawkish Democrats, however for now expectations are growing that most of it will make its way into the U.S. economy,” Mr. Hewson added, noting that bond markets appear to be pricing in that outcome with U.S. 10-year treasury yields hitting their highest since last March.

On the corporate side, South Africa halted the rollout of AstraZeneca’s COVID-19 vaccination after data showed it gave minimal protection against mild infection from one variant. Researchers from the University of Witwatersrand and the University of Oxford said in a prior-to-peer analysis that the AstraZeneca vaccine provided minimal protection against mild or moderate infection from the so-called South African variant among young people, Reuters reports.

In this country, investors will get results from Canada’s insurance industry later in the week. Sun Life Financial, Manulife Financial and Great-West Lifeco are all expected to report earnings after the close of trading on Wednesday.

On Friday, markets will also get the latest results from Air Canada. Last week, Air Canada announced it was halting all operations of its Rouge aircraft indefinitely. Canadian carriers have suspended flights to Mexico and the Caribbean at the request of the federal government as part of the continued effort to fight the spread of the novel coronavirus. The measure is expected to last until the end of April.

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After the markets close Monday, TSX operator TMX Group reports its quarterly earnings.

Overseas, major European markets gained in early going. The pan-European STOXX 600 was up 0.46 per cent. Germany’s DAX gained 0.25 per cent. Britain’s FTSE 100 rose 0.72 per cent and France’s CAC 40 was up 0.64 per cent.

In Asia, Japan’s Nikkei finished up more than 2 per cent. Hong Kong’s Hang Seng advanced 0.11 per cent.

Commodities

Crude prices rose, with Brent cracking US$60 a barrel for the first time in a year, bolstered by U.S. stimulus hopes and producer supply cuts.

The day range on Brent is US$59.43 to US$60.27. The range on West Texas Intermediate is US$57.00 to US$57.68. Both managed their best levels since January 2020.

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“Evidence is building that demand is recovering, and global inventories are falling,” Axi chief global market strategist Stephen Innes said.

“Bloomberg estimates that global oil inventories have declined by around 300 million barrels since implementing the OPEC+ production cut agreement last year.”

At some point, Mr. Innes said, spare capacity sitting at the sidelines will become an issue.

“Still, as it stands right now, traders are willing to look through just about anything with the U.S. reopening narrative getting a boost for vaccination protocols that should continue to flatten the curve and with the gale-force stimulus tailwinds supporting a spring break reopening,” he said.

Prices were drawing support from deeper production cuts from Saudi Arabia, which pledged extra supply curbs in February and March in the wake of reductions by OPEC members and their allies.

A softer U.S. dollar also boosted crude’s appeal. As well, dimming prospects of Iranian supply returning to market underpinned gains after U.S. President Joe Biden said the United States would not lift sanctions on Iran simply to get it back to the negotiating table.

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In other commodities, gold prices were steady.

Spot gold was little changed at US$1,812.17 an ounce and U.S. gold futures were also flat at US$1,812.80.

Currencies

The Canadian dollar was down slightly as its U.S. counterpart steadied against a group of world currencies after last week’s declines.

The day range on the loonie is 78.26 US cents to 78.40 US cents.

The Canadian economic calendar is light through the week with only wholesale trade figures due on Friday. Bank of Canada deputy governor Timothy Lane gives a speech by video conference on Wednesday.

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“The CAD is seeing no clear support from continuing gains in crude oil prices or equities while hanging on to most of its climb on Friday on the back of a weak U.S. jobs print—notwithstanding Canada’s own, even weaker, jobs print,” Shaun Osborne, chief FX strategist with Scotiabank, said.

On world markets, the U.S. dollar index, which weighs the greenback against a basket of six major currencies, stood at 91.130, after falling 0.6 per cent on Friday.

Against the euro, the U.S. dollar traded 0.1-per-cent higher at US$1.2032 after a 0.7 per cent decline on Friday. The British pound bought US$1.3715, down 0.15 per cent.

Meanwhile, bitcoin jumped to a record high early Monday after Tesla Inc said in an annual filing that it invested about $1.5-billion in the cryptocurrency. Bitcoin jumped as high as US$43,625 early Monday morning.

More company news

The Globe’s Josh O’Kane reports Well Health Technologies Corp. accelerated its acquisition spree on the weekend as it said it would buy fellow Vancouver health-services company CRH Medical Corp. for US$292.7-million. The company said the deal would be largely financed by a concurrent $295.5-million private placement led by Hong Kong billionaire Li Ka-shing with support from unnamed institutional investors. Well added that it would also use some of its cash pile and a line of credit from Canadian Imperial Bank of Commerce and HSBC Holdings PLC.

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Aegis Brands Inc. said Monday it will sell Second Cup Coffee Co. to Montreal’s Foodtastic Inc. for $14-million. Aegis said it will now focus on its we will now focus on its Bridgehead Coffee and Hemisphere Cannabis business and look for new growth opportunities.

South Korea’s Hyundai Motor Co said on Monday it is not now in talks with Apple Inc on autonomous electric cars, just a month after it confirmed early-stage talks with the tech giant, sending the automaker’s shares skidding. Wiping $3-billion off its market value, Hyundai’s stock slid 6.2 per cent. Shares in its affiliate Kia Corp, which had been tipped in local media reports as the likely operational partner for Apple, tumbled 15 per cent - a $5.5-billion hit.

SoftBank Group Corp on Monday reported that third quarter net profit surged more than 20 times, beating estimates, driven by recovery at its Vision Fund unit. October-December net profit was 1.17 trillion yen (US$11.09-billion). That compared with an estimate of 171 billion yen from four analysts polled by Refinitiv SmartEstimate.

Hasbro Inc beat analysts’ estimates for quarterly revenue on Monday, boosted by demand for the toymaker’s board games and “Magic: The Gathering” collectible cards from families seeking entertainment during the pandemic-hit holiday season. The company’s net revenue rose to $1.72-billion in the fourth quarter ended Dec. 27, from $1.43-billion a year earlier. Analysts on average had expected revenue of $1.69-billion, according to a Refinitiv IBES estimate.

Economic news

(8:30 a.m. ET) U.S. CPI revisions

With Reuters and The Canadian Press

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