Resource shares help lift Toronto market to record high

Canada’s main stock index extended its record-setting run on Thursday, led by gains for resource and financial shares, as commodity prices rose and U.S. retail sales data bolstered investor optimism about the economy.
The S&P/TSX composite index ended up 129.28 points, or 0.5%, at 24,690.48, eclipsing the record closing high it posted on Wednesday.
On Wall Street, the S&P 500 and the Nasdaq pared their gains to end essentially unchanged, while the Dow notched a record closing high.
U.S. retail sales increased 0.4% in September, slightly more than expected, while weekly jobless claims fell unexpectedly.
“You have an economy that remains on solid footing, corporate profits on the rise, and central banks letting off the brakes,” said Angelo Kourkafas, investment strategist at Edward Jones Investments. “And all of that adds to the soft-landing optimism that has fueled the market gains so far here to date.”
Oil settled 0.4% higher at US$70.67 a barrel after data showed falling crude and fuel inventories in the United States. The energy group rose 1.2%, while materials added 0.7% as gold climbed to an all-time high.
Financials in Toronto advanced 0.6% as bank stocks added to their recent gains.
“The mostly upbeat earnings reports we’ve seen from U.S. banks has helped support Canadian financials,” along with expectations of an aggressive interest rate cut in Canada, said Douglas Porter, chief economist at BMO Capital Markets.
The BoC will cut its benchmark interest rate by an unusually large 50 basis points next week as price pressures ease, according to two-thirds of economists polled by Reuters. Money markets on Thursday were pricing in about 78% odds of a 50 basis point cut.
Beyond Canada, Taiwan Semiconductor Manufacturing Co, the world’s largest contract chipmaker, beat market estimates for profit and forecast a jump in fourth-quarter revenue, driven by demand for artificial intelligence chips.
The chipmaker’s U.S.-listed shares soared 9.8%, while artificial intelligence-trade favorite and TSMC customer Nvidia gained 0.9%. The optimism spread to other chip stocks, sending the broader Philadelphia SE Semiconductor index 1% higher.
A broadly upbeat start to the third-quarter earnings season, strong economic data and the Fed kicking off its policy-easing cycle have pushed the Dow and the S&P 500 to record highs in recent sessions, with the latter close to the psychologically important 6,000 mark.
The S&P 500 lost 1.00 points, or 0.02%, at 5,841.47 points, while the Nasdaq Composite climbed 6.53 points, or 0.04%, to 18,373.61. The Dow Jones Industrial Average rose 161.35 points, or 0.37%, to 43,239.05.
While the Dow advanced for the second straight day, small cap indexes fell. The Russell 2000 dipped 0.3% and the S&P Small Cap 600 slipped 0.2%, a day after closing at their highest in nearly three years.
A majority of S&P 500 sectors were also weaker, including rate-sensitive indexes such as utilities and real estate, which slipped 0.9% and 0.7%, respectively.
One other quirk is that U.S. equity benchmarks have advanced in recent days even as U.S. Treasury yields have crept up. On Thursday, the benchmark 10-year note yield rose 7.5 basis points to 4.091%.
In earnings-related moves, Travelers Companies and Blackstone Group advanced 9% and 6.3%, respectively, to record closing highs after both the insurer and the money manager posted third-quarter profit which beat market expectations.
The S&P Banks index edged up 0.1%, advancing for a fifth straight session, matching its mid-August run and just one off its six successive wins in April, as a slew of larger regional banks posted third-quarter numbers. M&T Bank and Synovus Financial rose more than 5%, but Truist Financial dropped 3.5% and Huntington Bancshares slipped 2.6%.
Outside financials, health insurer Elevance Health plummeted 10.6%, its biggest one-day drop since the start of the pandemic in March 2020, after slashing its full-year profit forecast.
Volume on U.S. exchanges was 11.34 billion shares, compared with the 12.08 billion average for the full session over the last 20 trading days.
Reuters, Globe staff