TORONTO — Canada's main stock index rose nearly 140 points Tuesday, led by strength in technology stocks, while U.S. stock markets also climbed.
The rally was led by technology stocks, with the Nasdaq rising 1.6 per cent.
That’s likely in anticipation of earnings reports around the corner from some of the biggest tech names, said Brianne Gardner, senior wealth manager of Velocity Investment Partners at Raymond James Ltd.
All eyes will be on companies like Meta, Microsoft and Alphabet as they report this week, she said. Tesla, also one of the “Magnificent Seven” stocks, reported earnings after the bell on Tuesday.
The S&P/TSX composite index closed up 139.76 points at 22,011.72.
In New York, the Dow Jones industrial average was up 263.71 points at 38,503.69. The S&P 500 index was up 59.95 points at 5,070.55, while the Nasdaq composite was up 245.33 points at 15,696.64.
A weaker-than-expected report on U.S. business activity likely also boosted market sentiment on Tuesday, as investors are looking for any data that would support interest rate cuts.
Whether it’s earnings reports or economic data, the market is very data-dependent right now, said Gardner.
The end of the week will bring the U.S. personal consumption expenditures, or PCE, report. That’s another key piece of inflation data as the U.S. Federal Reserve weighs when to start cutting interest rates.
“I think the Fed obviously prefers that inflation gauge,” Gardner said.
Recent inflation data was stronger than economists expected, Gardner said, so the question is whether the next report will follow suit or show something different.
Expectations for when the Fed will start cutting have been pared back significantly since the start of the year, with the central bank now expected to start in September and only cut once or twice in 2024.
“The U.S. has just been more resilient than a lot of people have thought,” said Gardner.
Tuesday’s rally was a break from the recent run of down days, which Gardner described as a correction after a multi-month run led by hopes for artificial intelligence.
The TSX weathered that correction better than U.S. indexes thanks to strength in the energy sector and having less exposure to technology, she said.
The Canadian dollar traded for 73.14 cents UScompared with 72.91 cents US on Monday.
The June crude oil contract was up US$1.46 at US$83.36 per barrel and the May natural gas contract was up two cents at US$1.81 per mmBTU.
The June gold contract was down US$4.30 at US$2,342.10 an ounce and the May copper contract was down five cents at US$4.43 a pound.
— With files from The Associated Press
This report by The Canadian Press was first published April 23, 2024.
Companies in this story: (TSX:GSPTSE, TSX:CADUSD)
Rosa Saba, The Canadian Press
