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The Canadian benchmark stock index closed modestly higher Thursday amid a flood of mostly positive earnings reports that helped revive speculation that markets won’t be returning to recent lows - at least in the short term. But the energy sector continued to weigh on performance, as concerns about a slowing global economy pushed oil prices to their lowest since before Russia’s February invasion of Ukraine.

The S&P/TSX composite index ended up 31.10 points, or 0.2%, at 19,577.04, holding near the top of its range since June.

“The message so far has been that the sky’s not falling,” said Angelo Kourkafas, investment strategist at Edward Jones Investments. “Even though the (corporate) results are not great, they are good enough. They’ve been good enough so far with consumer demand generally proving to be fairly resilient.”

Shares of business aircraft manufacturer Bombardier Inc jumped 10.4% after the company reported a smaller quarterly loss, helped by steady demand and lower interest expenses.

The industrials sector rose 1.8%, while consumer-related sectors also notched solid gains, led by Restaurant Brands International Inc. Its shares ended 7.6% higher as the company beat second-quarter sales and profit estimates, boosted by strong demand at its Burger King and Tim Hortons restaurants.

Also reporting favourable results were BCE, which gained 0.6%; Thomson Reuters, up 4% for the session; and Home Capital, up 4.7%.

Canadian Natural Resources reported Thursday that its cash flow from operations roughly doubled to almost $5.9 billion in the second quarter, and the company announced a special dividend. But shares in the energy producer closed down 2.2% amid the drag from lower oil prices.

The energy sector overall dropped 4.5% as oil prices fell to their lowest since before Russia’s invasion of Ukraine in February. U.S. crude oil futures settled 2.3% lower at $88.54 a barrel. Traders fretted that any recession could torpedo energy demand, while an unexpected surge in U.S. crude inventories this week also weighed on prices, which had surged to over US$120 a barrel this year.

Maple Leaf Foods Inc was also a drag on the TSX. It tumbled 17.2% after the company reported quarterly earnings that significantly missed estimates. Challenges in labour markets, supply chains and inflation pushed it to a 44 cents per share net loss for the second quarter; the Street had been expecting net profits of 12 cents a share. The company took a $18.6 million restructuring charge on its plant protein group as it looks to “rightsize” the business.

The TSX materials sector, which includes precious and base metals miners and fertilizer companies, added 2.6% as gold and copper prices rose.

Investors awaited U.S. and Canadian employment data on Friday that could guide expectations for additional interest rate hikes by the Federal Reserve and the Bank of Canada.

That wait-and-see posture made for a dull day of trading on Wall Street, with gains in high-growth stocks offsetting losses in energy shares.

The tech-heavy Nasdaq hit a fresh three-month high led by Inc and Advanced Micro Devices, while losses in energy stocks including Exxon Mobil and Chevron Corp weighed on the S&P 500.

U.S. bond yields slipped after the Bank of England warned of a long recession. The U.S.10-year yield slipped 6.3 basis points to 2.6846%.

Strong earnings reports and a surprise pick-up in services sector activity had sent the main U.S. indexes sharply higher in the previous session.

“The market is looking for direction after a strong bounce that relieved the deep pessimism that had permeated the markets,” Yung-Yu Ma, chief investment strategist at BMO Wealth Management.

“Many signs indicate that inflation has peaked and the question now turns to how quickly it will come down or whether stickier components will keep it higher than the Fed is comfortable with.”

The Dow Jones Industrial Average fell 85.68 points, or 0.26%, to 32,726.82, the S&P 500 lost 3.23 points, or 0.08%, to 4,151.94 and the Nasdaq Composite added 52.42 points, or 0.41%, to 12,720.58.

The U.S. employment report Friday is expected to show nonfarm payrolls increased by 250,000 jobs last month, after rising by 372,000 jobs in June.

Cleveland Fed President Loretta Mester, a voting member of the rate-setting panel, reiterated the need to see several months of inflation coming down toward the Fed’s 2% target before policymakers can let up on tightening monetary policy.

The S&P 500 has gained about 14% from its mid-June lows, but is still down about 13% for the year on concerns around the fallout of the Ukraine war, soaring inflation, COVID-19 flare-ups in China and an aggressive rise in interest rates.

Among individual stocks, crypto exchange Coinbase Global Inc jumped 10% after it announced a tie-up with BlackRock to provide its institutional clients access to crypto trading and custody services.

Health insurer Cigna Corp gained 3.1% after raising its annual profit forecast.

Drugmaker Eli Lilly and Co slipped 2.6% as it cut annual profit view for the second time.

Facebook-parent Meta Platforms closed up 1.0% after it said it would make its first-ever bond offering.

Advancing issues outnumbered decliners by a 1.02-to-1 ratio on the NYSE and 1.40-to-1 ratio on the Nasdaq. The S&P index recorded one new 52-week high and 29 new lows, while the Nasdaq recorded 59 new highs and 31 new lows. Volume on U.S. exchanges was 11.38 billion shares, compared with the 10.76 billion average for the full session over the last 20 trading days.

Reuters, Globe staff

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