Canada’s main stock index rose slightly on Tuesday as gains in the materials sector countered losses in the energy sector following a drop in oil prices.
At 11:45 a.m. ET, the Toronto Stock Exchange’s S&P/TSX Composite index was up 32.37 points, or 0.2 per cent, at 16,378.84.
Six of the index’s 11 major sectors were lower, with energy down 0.3 per cent. Oil prices fell after a survey showed OPEC’s output hit a 2018 high in July, reigniting concerns about supply swamping demand.
The materials sector, which includes precious and base metals miners, added 0.8 per cent, boosted by shares of First Quantum Minerals, which jumped 3.2 per cent after posting quarterly results.
Canada’s economy grew by 0.5 per cent in May, the biggest rise in a year, as industries recovered from a combination of bad weather and maintenance shutdowns in April, according to Statistics Canada data.
Producer prices grew by 0.5 per cent in June from May on higher prices for primary non-ferrous metal products, as well as motorized and recreational vehicles.
WestJet Airlines Ltd. fell 10.1 per cent, the top laggard on the TSX, followed by shares of Shopify Inc. , down 4.1 per cent after results.
U.S. stocks rose on Tuesday, led by industrial companies, after a report that the U.S. and China were trying to resume negotiations to defuse a trade war between world’s two largest economies.
Representatives of U.S. Treasury Secretary Steven Mnuchin and Chinese Vice Premier Liu He are having private conversations as they look for ways to reengage in negotiations, Bloomberg reported, citing sources.
The escalating trade dispute between the two countries, with the United States and China imposing tariffs on $34 billion of each other’s goods earlier this month, has weighed heavily on the equity markets. The likelihood of a respite boosted the markets, with nine of the 11 major S&P sectors higher.
The industrials sector jumped 1.74 per cent and was on pace for its best one-day gain in three weeks. Boeing, Caterpillar and 3M jumped between 1.7 per cent and 2.5 per cent.
“The notion that side talks are happening has been an ongoing thing, but the question is who is really involved in those talks and if they are substantial,” said Jason Browne, chief investment strategist at FundX Investment Group in San Francisco.
“Overall people are trying to look for something other than technology stocks at the moment.”
After a three-day slide, the technology sector rose 0.39 per cent. Microsoft gained 0.7 per cent and was the biggest boost to the S&P and the Nasdaq.
Apple, due to report after the bell, was marginally lower. Others in the so-called FAANG group — Facebook, Amazon, Netflix and Google parent Alphabet — were flat to up 1 per cent.
The Dow Jones Industrial Average was up 121.44 points, or 0.48 per cent, at 25,428.27, the S&P 500 was up 13.52 points, or 0.48 per cent, at 2,816.12 and the Nasdaq Composite was up 36.65 points, or 0.48 per cent, at 7,666.65.
Core personal consumption expenditures (PCE), the Federal Reserve’s preferred measure of inflation, rose 1.9 percent year-over-year in June, the Commerce Department said.
The Fed is expected to leave interest rates unchanged when it wraps up its two-day meeting on Wednesday and has forecast two more rate hikes by December.
Still, the financial sector fell 0.62 per cent, with bank stocks the biggest drags on the S&P and the Dow.
Among stocks, Pfizer’s shares rose 3.1 per cent, reversing course from premarket losses, after the drugmaker’s quarterly results topped estimates.
Chipotle Mexican Grill sank 6.1 per cent after at least 140 people said they had fallen sick after eating at an Ohio restaurant of the burrito chain operator.
Reuters