TORONTO — Canada’s main stock index saw a small uptick Monday as broad-based gains helped keep it in the green on a slow trading day.
The S&P/TSX composite index was up 30.23 points at 20,390.33.
With U.S. markets closed for the Martin Luther King Jr. Day holiday, it was a slow day on the TSX, said John Zechner, chairman and lead equity manager at J Zechner Associates. But there’s plenty of news to come this week and next, he said.
“You’re in the heart of earnings season,” at least in the U.S., he said, with the big tech players reporting next week.
Investors will be looking not just for the numbers, but for companies’ outlooks on the coming year, said Zechner.
Meanwhile, Canada is set to release inflation data Tuesday after the U.S. released its own numbers last week, showing a slight cooling that was welcomed by investors. Later in the week, the U.S. and Canada will both see new data on retail sales, giving more insight into how consumers have been faring.
So far, economic data released this year has shown a surprisingly positive outlook, said Zechner.
Given the pace and scale of interest rate hikes in 2022, “you’ve got to be impressed by the resilience of the economic data so far,” he said.
Inflation has been slowing, likely contributing to the small market rally that kicked off the year. Zechner said it feels like investors are a little more optimistic than central bank messaging has been: “The market is not buying, really, what the Fed is selling.”
A pair of surveys on business and consumer outlooks released Monday showed businesses expect to feel the pain as consumers pull back on spending in 2023.
Most businesses and consumers expect a recession in the next 12 months, the surveys found. However, most don’t think it will be severe, in line with what many economists are forecasting in Canada due to the prevailing strength of the labour market.
The Canadian dollar traded for 74.64 cents UScompared with 74.59 cents US on Friday.
The February crude oil contract was up US$1.47 at US$79.86 per barrel and the February natural gas contract was down 28 cents at US$3.42 per mmBTU.
The February gold contract was up US$22.90 at US$1,921.70 an ounce and the March copper contract was up two cents at US$4.22 a pound.
— With files from Nojoud Al Mallees
This report by The Canadian Press was first published Jan. 16, 2023.
Companies in this story: (TSX:GSPTSE, TSX_CADUSD=X)
