Energy Issues Lift TSX

Boeing, Dow in Focus

Stocks in Canada’s largest market held onto gains by Monday’s close, largely on the strength of energy stocks.

The S&P/TSX Composite Index held onto gains of 61.02 points to close Monday at 16,605.50.

The Canadian dollar strengthened 19 cents to 74.89 cents U.S.

Painted Pony Energy jumped nine cents, or 15.3%, to 68 cents, after Canadian Natural Resources said it would buy the company for $461 million, including debt. Natural Resources shares, for their part, tacked on 38 cents, or 1.4%, to $27.11.

Canopy Growth gained $1.65, or 7.4%, to $23.93, after the pot producer reported a smaller-than-expected quarterly loss on Monday.

Its gains were followed by Silvercorp Metals, which rose 93 cents, or 9.4%, to $10.80.

Kinaxis fell $12.23, or 5.9%, the most on the TSX, to $196.97, Pason Systems recovered from the red ink and gained four cents to $6.04.

ON BAYSTREET

The TSX Venture Exchange regained 7.68 points, or 1%, to end the session at 747.66.

Eight of the 12 TSX subgroups were higher on the day, as energy rumbled ahead 2.9%, health-care improved 1.9%, and financials popped 1.3%.

The four laggards weighed most by information technology, fading 2.9%, while gold docked 1.3%, and materials fell 0.4%.

ON WALLSTREET

The Dow Jones Industrial Average rallied on Monday as gains in economically sensitive stocks offset losses from mega-cap tech stocks like Microsoft.

The 30-stock index leaped 357.96 points, or 1.3%, to 27,791.44. Boeing and Dow Inc. were among the best-performing stocks in the blue-chip index, rising more than 5% each.

Caterpillar, considered to be a bellwether for the global economy, also climbed more than 5%. JPMorgan Chase added 1.2%.

The S&P 500 regained 9.19 points to 3,360.47, as both the energy and industrials sectors rose more than 2.4% as cyclical stocks led the major indexes higher on the week’s first day of trading. Monday’s session was the S&P 500's seventh straight day of gains. The advance left the S&P 500 less than 1% away from a record high.

The NASDAQ faltered 42.63 points by the close to 10,968.36, as traders trimmed positions in Big Tech stocks. Facebook, Netflix shares slid at least 2% each. Amazon dipped 0.6% and Alphabet fell 0.1%.

Monday’s moves came after President Donald Trump signed several executive orders over the weekend aimed at extending coronavirus relief.

Those orders continue the distribution of expanded unemployment benefits, defer student loan payments through 2020, extend a federal moratorium on evictions and provide a payroll tax holiday.

However, the unemployment benefit will be continued at a reduced rate of $400 per week. Originally, the benefit provided workers impacted by the pandemic with $600 per week.

Trump’s moves come after congressional leaders failed to make progress on a new coronavirus stimulus package last week. Several benefits from a package signed earlier in the year lapsed at the end of July, raising uncertainty about the U.S. economy moving forward.

Still, Trump’s orders face a legal challenge as continuing the programs would require federal funding, which Congress controls. Democrats have insisted they will not support a bill that does not extend the $600 per week benefit.

Investors also kept on eye on the worsening relationship between the U.S. and China. On Monday, China said it would apply sanctions against 11 U.S. citizens including senators Ted Cruz and Marco Rubio. The move is a retaliation against Washington’s sanctions on 11 Hong Kong and Chinese officials for curtailing political freedoms in the city.

Prices for the 10-Year Treasury lost a bit of ground, raising yields to 0.58% from Friday’s 0.56%. Treasury prices and yields move in opposite directions

Oil prices climbed 82 cents to $42.04 U.S. a barrel.

Gold prices gained $8.20 to $2,036.20 U.S. an ounce.