Toronto stocks close higher while U.S. stock markets mixed; Loonie moves down
The Toronto Stock Exchange Broadcast Centre is shown on June 28, 2013. THE CANADIAN PRESS/Aaron Vincent Elkaim
The Canadian Press
Published Friday, May 18, 2018 12:27AM EDT
Last Updated Friday, May 18, 2018 4:59PM EDT
Canada's main stock index closed higher Friday to continue its recent streak of gains, while the loonie moved lower on modest inflation and retail numbers.
The annual inflation rate cooled slightly in April to 2.2 per cent to remain just above the two per cent midpoint of the Bank of Canada's range, while retail sales climbed 0.6 per cent on stronger auto sales.
The results were somewhat positive, but not enough to increase the chances of more interest rate hikes from the Bank of Canada, said Philip Petursson, chief investment strategist at Manulife Investments.
"Inflation firmed up a little bit in Canada, and retail sales showed a little bit of strength, however our view is the Bank of Canada is going to be reluctant to raise rates more than once, given the other impacts to the Canadian consumer," he said.
Canadians are already grappling with three rate hikes, tightened mortgage rules, plus the rising oil prices that helped prop up inflation, Petursson said.
"This will on its own act as a headwind to the Canadian economy, so I don't think the Bank of Canada will necessarily be in a rush to raise rates further," he said.
Still, the S&P/TSX composite index managed to notch an 11th straight day of gains to close up 18.76 points at 16,162.31, pushed up by health-care and gold stocks.
The rally has seen the index climb 178.99 points this week, and 632.34 points in the past month.
Energy stocks, which have been driving the recent rally for the TSX, retreated slightly as the July crude contract ended down 20 cents at US$71.37 per barrel and the June natural gas contract closed down a penny at US$2.85 per mmBTU.
With no increase in interest rate hike expectations and lower crude prices the Canadian dollar averaged 77.64 cents US, down 0.48 of a US.
In New York, the Dow Jones industrial average closed up 1.11 points at 24,715.09. The S&P 500 index ended down 7.16 points at 2,712.97 and the Nasdaq composite index was down 28.13 points at 7,354.34.
The June gold contract closed up US$1.90 at US$1,291.30 an ounce and the July copper contract was down three cents at US$3.06 a pound.