TORONTO — Gains in energy and base metal stocks helped lift Canada's main stock index higher Friday, while U.S. markets were down after a day of mixed trading.
New jobs data in the U.S. and Canada released Friday showed a still-resilient labour market, helping seal the deal for central banks on both sides of the border to announce interest rate hikes at their next meetings.
The S&P/TSX composite index was up 20.35 points at 19,831.04.
In New York, the Dow Jones industrial average was down 187.38 points at 33,734.88. The S&P 500 index was down 12.64 points at 4,398.95, while the Nasdaq composite was down 18.33 points at 13,660.72.
Canada posted a bigger-than-expected gain of 60,000 jobs in June after a loss in May, but also saw unemployment rise to 5.4 per cent.
June was the second month in a row the unemployment rate has risen as economists and central bank officials eye the labour market for signs of cooling.
“The Bank of Canada has little choice but to raise another 25 basis points next week,” said Ashish Utarid, assistant vice-president of investment strategy at IG Wealth Management.
Meanwhile, the U.S. labour market added fewer jobs in June than in May, with wage growth holding steady.
Like its Canadian counterpart, the Federal Reserve is expected to announce a hike at its next meeting after pausing, said Utarid.
The Bank of Canada’s next rate decision is Wednesday while the Fed is set to announce its decision later in July.
“We have more jobs. We have sticky inflation in certain areas. And we have full labour force participation and high employment. Those are all leading to inflationary markers,” said Utarid.
“The interest rate hikes that have happened so far haven't had the effect that the Bank of Canada wanted,” he said.
Energy stocks helped lift markets, particularly in Canada where the sector was the biggest driver of gains Friday as the price of crude rose, said Utarid. The TSX's energy index rose 2.8 per cent Friday.
The Canadian dollar traded for 75.23 cents US compared with 74.92 cents US on Thursday.
The August crude oil contract was up US$2.06 at US$73.86 per barrel and the August natural gas contract was down three cents at US$2.58 per mmBTU.
The August gold contract was up US$17.10 at US$1,932.50 an ounce and the September copper contract was up five cents at US$3.78 a pound.
This report by The Canadian Press was first published July 7, 2023.
Companies in this story: (TSX:GSPTSE, TSX:CADUSD=X)
Rosa Saba, The Canadian Press