Equities in Canada’s largest market took their cues from their American cousins, and explored the upper reaches Wednesday, as a result of a change in the political picture down south (see below), and a hint that, perhaps, the deathly trend of COVID-19 was running out of gas.
The TSX Composite Index vaulted 311.57 points, or 2.3%, at 13,925.71.
The Canadian dollar demurred 0.06 cents to 71.28 cents U.S.
Real-estate displayed the most mojo on Wednesday, with Summit REIT units acquiring $1.30, or 14.6%, to $10.21, and Brookfield Property Partners garnering $1.51, or 12.5%, to $13.64.
In the discretionary sector, BRP Inc. gained $2.03, or 8.8%, to $25.02, and Gildan Activewear picked $1.49, or 7.5%, to $21.49.
Among tech firms, Celestica added 68 cents, or 14% to $5.53, while Shopify leaped $50.56, or 9.5%, to $580.99.
Communnications took a pounding, however, with Rogers docked $1.94, or 3.1%, to $60.96.
Economically speaking, Canada Mortgage and Housing Corporation reported housing starts registered at 195,200, compared to the expected 172,500, and to 210,100 in February.
Statistics Canada said building permits decreased 7.3% to $8.6 billion in February, driven by the residential component. Declines were reported in five provinces, with the largest decrease reported in British Columbia (-39.2% to $1.3 billion).
Prime Minister Justin Trudeau says Canada will keep up efforts to persuade the U.S. not to block the export of medical supplies to fight the coronavirus, while Alberta warned of an economic disaster.
ON BAYSTREET
The TSX Venture Exchange gained 6.34 points, or 1.6%, to 408.89.
All but one of the 12 TSX subgroups gained on the day, and lavishly at that, with real-estate stronger 6%, consumer discretionary and information technology each climbing 4.6%.
Only communications missed the party, down 1.9%
ON WALLSTREET
Stocks surged on Wednesday after Vermont Sen. Bernie Sanders dropped out of the presidential race, relieving some of Wall Street’s political concerns amid the economic crisis stemming from the coronavirus.
The Dow Jones Industrials screamed higher 779.71 points, or 3.4%, to 23,433.57
The S&P 500 jumped 90.57 points, or 3.4%, to 2,749.98. Energy was among the best-performing sectors in the S&P 500, jumping more than 6%. Health-care rallied more than 4%.
The NASDAQ Composite popped 203.64 points, or 2.6%, to 8,090.60. Hope the U.S. could start to turn a corner on the coronavirus outbreak in the near future also lifted equities.
The major averages hit their session highs after Sanders made his announcement. Some of Sanders’ policy proposals, including Medicare for All, raised concern among several business owners and investors who feared taxes would go up under his presidency.
Wednesday’s news puts former Vice President Joe Biden — who is seen by Wall Street as a more market-friendly candidate — closer to the Democratic nomination.
Stocks pressured by the coronavirus outbreak led the way higher. Carnival, Norwegian Cruise Line and Royal Caribbean all advanced at least 6.1%. MGM Resorts gained 10.1% while Wynn Resorts climbed 13.5%. United led airline stocks higher with a 12.4% jump. American gained 10.4%, and Delta traded higher by 4.4%.
In the U.S., the number of daily increases in coronavirus cases has fallen since Friday, according to data from Johns Hopkins University. Daily increases in global cases have also fallen since then.
Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases, told the media on Wednesday that the U.S. death count related to the coronavirus is now lower than initially thought, noting there should be a turnaround after this week. He added, however, virus efforts should be intensified.
However, some investors believe equities were getting ahead of the reality where coronavirus shutdowns are likely to weigh on the economy significantly beyond the second quarter. The major averages have rallied about 20% from their March 23 lows.
The Federal Open Market Committee released the meeting minutes from its March emergency meeting. The summary showed “all participants viewed the near-term U.S. economic outlook as having deteriorated sharply in recent weeks and as having become profoundly uncertain.”
Prices for the 10-Year U.S. Treasury faded, lifting yields to 0.77% from Tuesday’s 0.73%. Treasury prices and yields move in opposite directions.
Oil prices gained $2.52 to $26.15 U.S. a barrel.
Gold prices picked up $4.60 to $1,679.10 U.S. an ounce.
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