Stock markets worldwide bounced back on Friday after a multi-day selloff that left the equity markets on track for their biggest weekly losses in months, while U.S. Treasury yields moved higher and the dollar held its gains.
Canada’s main stock index also rose and was set to break its five-day losing streak, driven by gains in healthcare shares.
At 11:30 a.m. ET, the Toronto Stock Exchange’s S&P/TSX composite index was up 63.79 points, or 0.42 per cent, at 15,378.70.
Ten of Canada’s 11 major sectors were trading higher, led by healthcare sector’s 3.9-per-cent gain.
Shares of Aurora Cannabis Inc. rose 6.2 per cent, while peer cannabis producer Canopy Growth Corp. gained 5.4 per cent.
Lead by bank stocks, the heavy-weight financial sector edged up 0.2 per cent, tracking gains in Wall Street lenders following JPMorgan’s strong results.
The Canadian dollar edged higher against its U.S. counterpart as oil and stock prices rebounded, but the loonie was on track to end the week lower after multi-year peaks for Treasury yields contributed to market volatility.
Adding to the upbeat sentiment was a 1.1-per-cent rise in shares of energy companies as oil prices rose.
Materials was the only sector to decline, falling 1 per cent. as gold retreated from two-month highs touched on Thursday.
Kinross Gold Corp. was down 4.2 per cent, while Wheaton Precious Metals Corp. was 4.1 per cent lower and Barrick Gold Corp. lost 2.9 per cent.
Wall Street surged after the U.S. stock market’s worst two days of losses since February, with the technology sector moving towards its best day in seven months after being hammered earlier in the week.
Technology companies recovered after taking some hard hits over the last two days. Apple climbed 2.9 per cent to $220.71 and Microsoft gained 2.8 per cent to $108.83. Consumer-focused companies also rallied, as Amazon jumped 4.1 per cent to $1,789 and Netflix surged 5.5 per cent to $338.74.
The Dow Jones Industrial Average jumped 278 points, or 1.1 per cent, to 25,330. The Nasdaq composite surged 149 points, or 2 per cent, to 7,478. The Russell 2000 index gained 10 points, or 0.7 per cent, to 1,555. That index, which is made up of smaller and more U.S.-focused companies, has fallen into a 10-per cent “correction” since reaching a record high at the end of August.
On the New York Stock Exchange, winners outnumbered losers by nearly three to one.
Several other groups of stocks that have struggled this year are now in a “correction,” a drop of at least 10 per cent from a recent peak. They include basic materials makers, internet companies, banks and household goods makers.
Bond prices turned lower as the stock market stabilized. The yield on the 10-year Treasury note rose to 3.15 per cent from 3.13 per cent.U.S. automakers Ford and General Motors continued to slump. GM shed 0.4 per cent to $32.19, its lowest in almost two years, and Ford dipped 0.1 per cent to $8.81, its lowest in almost nine years. Both have fallen more than 20 per cent this year as the Trump administration’s tariffs on steel and aluminum send their manufacturing costs higher.
The MSCI All-Country World index, which tracks shares in 47 countries, was up 1.4 per cent on the day.
European stocks also opened higher following a rise in Asian shares overnight, but began to edge lower by mid-morning. The pan-European FTSEurofirst 300 index lost 0.06 per cent.
“Some traders are cautiously buying back into the market today, but the underlying issues which brought about the sell-off are still relevant,” CMC Markets analyst David Madden said.
Results for the United States’ largest banks, which began to roll in on Friday, were expected to set the tone for earnings season and help gauge the impact on U.S. company profits from President Donald Trump’s trade war with China.
“The market is going to focus on not just current quarter earnings, but guidance going forward, particularly as it relates to the profit margins. You’ve got some indications of rising wage pressure and higher interest rates,” said Willie Delwiche, investment strategist at Robert W. Baird in Milwaukee.
The biggest market shakeout since February has been blamed on factors including fears about the impact of the U.S.-China tariff fight, a spike in U.S. bond yields this week and caution ahead of earnings season.
Trade figures from China on Friday showed China’s trade surplus with the United States hit a record high in September, providing a likely source of contention with Trump over trade policies and the currency.
The data showed solid expansion in China’s overall imports and exports, suggesting little damage to the country from the tit-for-tat tariffs with the U.S.
MSCI’s broadest index of Asia-Pacific shares outside Japan rose 2.31 per cent, the biggest one-day gain for more than two years. The bounce came after the index fell 3.6 percent on Thursday to hit a 1-1/2-year low.
The dollar index rose 0.25 per cent, with the euro down 0.29 per cent to $1.1559.
U.S. Treasury yields rose on Friday, recovering from falls in the previous session, after data showed U.S. import prices grew at a faster pace than expected last month, adding to the narrative that inflation is accelerating.
Gold, which had risen to a 10-week high on the back of the stock market selloff, fell 0.4 per cent to $1.219.38 an ounce.
Oil rebounded towards $81 a barrel as the equities rally lent support, though prices pared gains after a closely watched forecaster deemed supply adequate and the outlook for demand weakening.
U.S. crude rose 0.55 per cent to $ 71.36 per barrel and Brent was last at $80.36, up 0.12 per cent on the day.
Reuters and The Associated Press