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TORONTO — Canada's main stock index posted its 10th straight week of gains as it was bolstered Friday by a broad-based rally.
The S&P/TSX composite index closed up 69.24 points to 16,068.25 after hitting a five-month high.
The tone for the day was set early with strong data out of China, and wasn't shaken later by data from Canada for the last three months of 2018 that showed the weakest quarterly economic performance since the middle of 2016, says Scott Guitard, vice-president and portfolio manager at Fiduciary Trust Canada.
"I think overall, investors are looking for reasons for markets to go up, so sentiment overwhelmed everything else," he said in an interview.
The softer GDP number showing the economy grew by an annualized pace of just 0.4 per cent was shrugged off to some extent because it reinforced the belief that the Bank of Canada will sit on its hands about raising interest rates, Guitard said.
The TSX was helped by gains in nine of the 11 major sectors led by technology, consumer discretionary and energy stocks.
The key energy sector was up 0.84 per cent despite a 2.5 per cent drop in the price of crude oil.
The April crude contract was down $1.42 at US$55.80 per barrel and the April natural gas contract was up 4.7 cents at US$2.86 per mmBTU.
A broad array of Canadian energy producers, including Canadian Natural Resources, Enbridge Inc. and TransCanada Corp., saw their stocks rise a day after the Alberta government raised its quota for producers by 25,000 barrels per day for April, the second easing since it imposed quotas designed to keep 325,000 bpd off the market starting Jan. 1.
"Canadian oil prices still look good relative to where they've been and now with the ease of the curtailments it's a positive for the energy sector in Canada," said Guitard.
The Canadian dollar traded at an average of 75.41 cents compared with an average of 75.94 cents US on Thursday. It lost ground in response to the weak GDP numbers.
The April gold contract was down US$16.90 at US$1,299.20 an ounce and the May copper contract was down 1.6 cents at US$2.93 a pound.
In New York, the Dow Jones industrial average was up 110.32 points at 26,026.32. The S&P 500 index was up 19.20 points at 2,803.69, while the Nasdaq composite was up 62.82 points at 7,595.35.
U.S. market sentiment was helped by ongoing hope about a trade deal between the United States and China following a report that U.S. officials are preparing to sign a trade deal with China within a month.
"There continues to be hopefulness around the U.S.-China talks that they'll come up with some form of trade agreement in the near-term so I think investors have decided to focus on those positives," Guitard added.
While North American markets have almost recovered from the deep losses late last year, Guitard said he wouldn't be surprised to see a pull-back because geopolitical issues such as trade and Brexit remain unresolved.
"I wouldn't be surprised to see it stall out in the short-term because there's been so much focus on the positives in the market, but these uncertain events are still out there."
Companies, index and currency in this story: (TSX:CNQ, TSX:ENB, TSX:TRP, TSX:GSPTSE, TSX:CADUSD=X)
Ross Marowits, The Canadian Press
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