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Canada’s main stock index posted its biggest gain of the year Thursday, as technology shares basked in the glow of Facebook-parent Meta Platform’s upbeat earnings, while sharp gains for Suncor Energy boosted the energy sector.

U.S. markets also rallied after Meta Platforms rose 17.6% and lifted beaten down technology and growth stocks and offset worries about the U.S. economy’s contraction in the first quarter.

Equity markets have been pressured in recent days by worries that the war in Ukraine, as well as COVID-19 lockdowns in China and potentially aggressive interest rate hikes by central banks will slow global economic growth.

But dip-buyers regained some confidence Thursday, as generally positive U.S. earnings reports continued to pile in.

“When interest rates, the inflation path and what the Fed is going to do are so volatile, it just means that pricing every other asset is that much more difficult,” said Zach Hill, head of Portfolio Strategy at Horizon Investments in Charlotte, North Carolina.

“We’ve done a lot of earnings data over the last couple days and weeks and by and large, outside of a few particular cases, corporate America’s underlying fundamentals have been relatively strong,” Hill said.

The S&P/TSX composite index ended up 376.83 points, or 1.8%, at 21,121.06, its biggest gain since Dec. 21.

The Toronto market’s technology sector rose 2.5%, while energy ended 5.1% higher. It was led by a 12% jump in the shares of Suncor Energy after hedge fund Elliott Management pushed the company to undertake a strategic review of its business and refresh its board.

Higher oil prices added to support for energy. U.S. crude oil futures settled 3.3% higher at $105.36 a barrel after reports that Germany is no longer opposed to an embargo on Russian oil, which could further tighten supplies in the already stressed global crude market.

The heavily-weighted financials sector advanced 1.7%, while the materials group, which includes precious and base metals miners and fertilizer companies, was up 1.4%.

The S&P 500 climbed 2.47% to end the session at 4,287.50 points. The Nasdaq gained 3.06% to 12,871.53 points, while Dow Jones Industrial Average rose 1.85% to 33,916.39 points.

Communication services and technology were among the strongest of 11 S&P 500 sector indexes, jumping 4.04% and 3.89%, respectively.

Apple Inc, the world’s most valuable company, and e-commerce giant Inc both rallied more than 4% ahead of their quarterly reports later in the day.

In extended trade, Amazon tumbled about 10% after the company forecast current-quarter sales below Wall Street estimates. Apple shares held generally steady after beating expectations on both the top and bottom line.

Investors have been dumping high growth stocks for weeks, due to worries about inflation, rising interest rates and a potential economic slowdown. Even with Thursday’s strong gain, the tech-heavy Nasdaq was down almost 10% in the month of April, on track for its deepest one-month decline since March 2020.

The U.S. economy unexpectedly contracted in the first quarter as COVID-19 cases surged again, and government pandemic relief money dropped, data showed Thursday.

The first decrease in gross domestic product since the short and sharp pandemic recession nearly two years ago, reported by the Commerce Department, was mostly driven by a wider trade deficit as imports surged, and a slowdown in the pace of inventory accumulation.

Overall, first-quarter earnings have been better than expected, with 81% of the 237 companies in the S&P 500 that have reported results so far beating Wall Street expectations. Typically, only 66% of companies beat estimates, according to Refinitiv data.

Qualcomm Inc surged 9.7% after the chipmaker forecast third-quarter revenue above analyst expectations.

The Philadelphia Semiconductor Index surged 5.6% in its biggest one-day gain in over a year.

Caterpillar Inc fell 0.7% after it warned that profit margins in the current quarter were likely to be pressured from surging costs.

Among other movers, Amgen Inc fell 4.3% after the drugmaker said the U.S. Internal Revenue Service is seeking additional back taxes of $5.1 billion.

Volume on U.S. exchanges was 12.3 billion shares, compared with an 11.8 billion average over the last 20 trading days.

Across the U.S. stock market, advancing stocks outnumbered declining ones by a 2.6-to-one ratio.

The S&P 500 posted five new 52-week highs and 44 new lows; the Nasdaq Composite recorded 25 new highs and 672 new lows.

Reuters, Globe staff

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