S&P/TSX composite ends solid week directionless with U.S. markets closed

S&P/TSX composite ends solid week directionless with U.S. markets closed

S&P/TSX composite ends solid week directionless with U.S. markets closed

TORONTO — Canada’s main stock index wrapped up a solid week on a down note while U.S. markets were closed for the Independence Day holiday.

Crude oil and gold prices were down a little bit but not enough to “really spook” the market so the Toronto Stock Exchange followed the path set in Europe where investors took some profits after recent gains, said Philip Petursson, chief investment strategist at Manulife Investment Management.

“It’s kind of one of those wishy-washy days where when you don’t have the leader, which is the U.S. equity markets, [so] the market is searching for direction,” he said in an interview.

Petursson said the market is hitting that third phase of exhaustion after the prior two of a bear market and a sharp rebound.

“In this phase what we’re doing is we’re waiting for the results and it’s not necessarily just the economic results, more importantly its the earnings results or anything that leads to a positive earnings outlook in Q4 or into 2021 to really drive the market to that next leg higher.”

Second-quarter earnings, which start mid-month are expected to be very bad, said Petursson.

“No matter what the earnings look like the market is just going to shrug it off,” he said.

Rather than recent performance, investors are going to be looking for signs in company guidance that “baby steps” are being taken back to normal despite the increase in COVID-19 infections in the United States.

The S&P/TSX composite index closed down 25.65 points at 15,596.75. It ended the week up 2.7 per cent on a rise in oil and gold prices.

The Canadian dollar also appreciated with oil surpassing US$40 a barrel. It traded for 73.72 cents US compared with 73.61 cents US on Thursday.

Petursson expects the loonie will reach 75 to 77 cents as crude rises to US$45 per barrel, gaining to hit about US$60 over some 18 months.

On Friday, the August crude contract was down 33 cents at US$40.32 per barrel and the August natural gas contract was up 1.6 cents at US$1.75 per mmBTU.

Husky Energy Inc. was the weakest performer as its shares dropped 2.6 per cent, followed by Vermilion Energy Inc. at 2.1 per cent and Cenovus Energy Inc. off two per cent.

Nine of the 11 major sectors on the TSX were lower amid low trading because of the U.S. holiday.

Health care, real estate and materials decreased.

The August gold contract was down US$2.70 at US$1,787.30 an ounce and the September copper contract was down 2.75 cents at US$2.72 a pound.

Consumer staples and telecommunications were slightly higher.

The market choppiness should continue, rising one day and then dipping as investors take some profits, Petursson said.

“This is what I expect to happen until the fall where I think we will have a better picture on what the start of 2021 is going to look like, not only with respect to COVID, more importantly to earnings.”

This report by The Canadian Press was first published July 3, 2020.

Companies in this story: (TSX:HSE, TSX:VET, TSX:CVE, TSX:GSPTSE, TSX:CADUSD=X)

Ross Marowits, The Canadian Press

Business

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

SARS-CoV-2 virus particles, which causes COVID-19, emerge from the surface of cells isolated from a patient in the U.S. and cultured in a lab in a 2020 electron microscope image. THE CANADIAN PRESS/AP-HO, National Institute of Allergy and Infectious Diseases - Rocky Mountain Laboratories
Alberta now has 17,743 active cases of COVID-19

Province now has 17,743 active cases

File Photo
Sylvan Lake Community Christmas Eve Dinner cancelled

The 20th anniversary of the Community Christmas Eve dinner is cancelled amidst COVID-19 concerns

The consensus around the Sylvan Lake council chamber Wednesday was the town does not have the ability to properly enforce a proposed mandatory indoor mask bylaw. File Photo
Sylvan Lake town council squashes mask bylaw

The bylaw did not make it past first reading, after a 4-3 vote defeated the motion

Sylvan Lake RCMP are looking for the identity of the suspect who stole from over 40 resident mail boxes. (Photo Courtesy of Sylvan Lake RCMP)
Over 40 mailboxes broken into at Sylvan Lake apartment building

Sylvan Lake RCMP are investigating the incident and searching for the identity of the suspect

Melissa David, of Parachutes for Pets and her dogs Hudson and Charlie are trying to raise money for a homeless shelter that will allow pets and are seen in Calgary, Alta., Thursday, Feb. 6, 2020.THE CANADIAN PRESS/Jeff McIntosh
‘My only wish:’ Children asking pet charity to help their furry friends at Christmas

Parachutes for Pets says it has received 14 letters from children in the last week t

Melissa Velden and her chef-husband Chris Velden, stand in their dining room at the Flying Apron Inn and Cookery in Summerville, N.S. on Friday, Nov. 20, 2020. The couple is hosting holiday parties with appropriate distancing and other COVID-19 health protocols in place at their restaurant. THE CANADIAN PRESS/Andrew Vaughan
Celebrities, Santa and Zoom part of office holiday parties being held amid COVID-19

Many will send tokens of appreciation to workers or offer time off or cash

Ten-month-old Aidan Deschamps poses for a photo with his parents Amanda Sully and Adam Deschamps in this undated handout photo. Ten-month-old Aidan Deschamps was the first baby in Canada to be diagnosed with spinal muscular atrophy through Ontario’s newborn screening program. The test was added to the program six days before he was born. THE CANADIAN PRESS/HO, Children’s Hospital Eastern Ontario *MANDATORY CREDIT*
First newborn tested for spinal muscular atrophy in Canada hits new milestones

‘If Aidan had been born any earlier or anywhere else our story would be quite different’

People line up at a COVID-19 assessment centre during the COVID-19 pandemic in Scarborough, Ont., on Wednesday, December 2, 2020. Toronto and Peel region continue to be in lockdown. THE CANADIAN PRESS/Nathan Denette
COVID-19 vaccine approval could be days away as pressures mount on health-care system

Many health officials in regions across the country have reported increasing pressures on hospitals

A logo for Netflix on a remote control is seen in Portland, Ore.,Aug. 13, 2020. Experts in taxation and media say a plan announced Monday by the government will ultimately add to the cost of digital services and goods sold by foreign companies. THE CANADIAN PRESS/AP-Jenny Kane
‘Netflix tax’ for digital media likely to raise prices for consumers, experts say

The government says Canadian companies already collect those taxes when they make digital sales

Gaming content was big on YouTube in 2020. (Black Press Media files)
What did Canadians watch on Youtube during isolation? Workouts, bird feeders

Whether it was getting fit or ‘speaking moistly,’ Canadians had time to spare this year

A teacher places the finishing touches on the welcome sign at Hunter’s Glen Junior Public School which is part of the Toronto District School Board (TDSB) during the COVID-19 pandemic in Scarborough, Ont., on Sept. 14, 2020. THE CANADIAN PRESS/Nathan Denette
Hindsight 2020: How do you preserve a year many Canadians would rather forget?

Figuring out how to preserve the story of the pandemic poses a series of challenges

Most Read