Canada’s main stock index opened lower on Friday, weighed down by financial shares and after data showed lower-than-expected U.S. jobs and wages growth in April.
The Toronto Stock Exchange’s S&P/TSX Composite Index fell 17.99 points, or 0.12 per cent, to 15,603.48.
The Canadian dollar weakened to a one-month low against a broadly firmer greenback on Friday as investors weighed U.S. jobs data and trade discussions between top officials from China and the United States.
The U.S. dollar climbed against a basket of major currencies despite a smaller-than-expected rise in U.S. jobs for the month of April.
Officials from China and the United States reached a consensus on some aspects of the countries’ trade row, but disagreements over other issues remain “relatively big,” China said.
Canada’s commodity-linked economy could be hurt if the trade spat between the two economic giants slows global growth.
The Canadian dollar was trading 0.4 per cent lower at $1.2912 to the greenback, or 77.45 U.S. cents.
The currency touched its weakest level since April 3 at $1.2917. For the week, the loonie was on track to fall 0.7 per cent.
Losses for the loonie on Friday came after data the day before showed that Canada’s trade deficit had widened to a record in March.
U.S. stock indexes opened lower on Friday after data showed weaker-than-expected U.S. jobs and wages growth in April, while unemployment rate dropped to a 17-1/2-year low.
The Dow Jones Industrial Average fell 64.93 points, or 0.27 per cent, at the open to 23,865.22. The S&P 500 opened lower by 8.28 points, or 0.31 per cent, at 2,621.45. The Nasdaq Composite dropped 22.48 points, or 0.32 per cent, to 7,065.67 at the opening bell.
The Labor Department’s closely watched report showed non-farm payrolls increased by 164,000 jobs last month, while the unemployment rate was 3.9 per cent. However, wages edged up only 0.1 per cent, easing concerns that inflation pressures were increasing.
“It’s a goldilocks number ... the top line missed a little bit from consensus expectations, however you had the unemployment rate drop below 4 per cent, lowest since December of 2000,” said Michael Arone, chief investment strategist at State Street Global Advisors in Boston.
“Investors continue to look for signs of inflation and we really didn’t get any. I don’t see this particular report changing the Fed’s path or the recent trend.”
After the data, stock futures initially cut some of their losses, before reversing course to drop sharply and finally ended up little changed from their levels before the report.
“It really is a mystery these days to me in terms of how market participants are reacting,” Arone said.
Investors were also watchful of details after China and the United States had talks in Beijing to settle trade differences.
China has offered to buy more U.S. goods and lower tariffs on some items, including cars, Reuters reported after Xinhua news agency said the talks had made progress on some aspects, though disagreements over other issues remained.
Among stocks, Apple rose 1.1 per cent after Warren Buffett’s Berkshire Hathaway raised its stake in the iPhone maker.
Twitter dropped 1.4 per cent after disclosing a glitch that led to some passwords being stored in readable text on its internal computer system rather than disguised by a process known as “hashing.”
Oil prices rose on Friday but stayed below recent highs as global supplies remained tight and the market awaited news from Washington on possible new U.S. sanctions against Iran.
Brent crude oil was up 10 cents at $73.72 a barrel. The benchmark contract hit a 3-1/2 year closing high of $75.17 on Monday.
U.S. light crude was 15 cents higher at $68.58.
“The energy complex is entering a consolidation phase as a wait-and-see approach takes hold ahead of next week’s Iranian sanctions waiver deadline,” said Stephen Brennock, analyst at London brokerage PVM Oil Associates.
“Expectations that the United States will pull out of the (Iran nuclear) deal and refrain from extending sanctions relief are keeping both crude markers near three-year peaks,” he added.
ANZ analysts Daniel Hynes and Soni Kumari said Brent could reach $80 a barrel by the end of this year, attributing recent strength to rising geopolitical risks and tighter global supply.
“We expect the market to tighten even further in second half 2018,” they wrote in a note to clients.