August 16, 2022

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S&P/TSX Composite Index Edges Higher Amid Strength Among Energy Stocks

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After an early move to the downside, Canadian stocks fluctuated over the course of the trading session on Friday before closing modestly higher.

The benchmark S&P/TSX Composite Index moved higher going into the close, ending the day up 43.09 points or 0.2 percent at 19,620.13.

Strength among energy stocks contributed to the modestly higher close on Bay Street, with the S&P/TSX Capped Energy Index jumping by 1.9 percent.

Energy stocks regained ground following recent weakness, as the price of as crude oil for September delivery rose $0.47 to $89.01 a barrel after falling to the lowest levels since Russia’s invasion of Ukraine.

Most of the other major sectors showed only modest moves on the day, although notable weakness was visible among consumer staples stocks.

The lackluster performance seen over the course of the session came as traders reacted to the U.S. Labor Department’s closely watched monthly jobs report.

The report showed employment in the U.S. jumped by much more than expected in the month of July, leading to concerns about the outlook for interest rates.

The report showed non-farm payroll employment spiked by 528,000 jobs in July after surging by an upwardly revised 398,000 jobs in June.

Economists had expected employment to climb by about 250,000 jobs compared to the addition of 372,000 jobs originally reported for the previous month.

With the stronger than expected job growth, the unemployment rate unexpectedly edged down to 3.5 percent July from 3.6 percent in June. The unemployment rate was expected to remain unchanged.

While the data paints a positive picture of the labor market, the report may also give the Federal Reserve confidence they can continue aggressively raising interest rates without causing a recession.

A separate report from Statistics Canada showed Canadian employment edged down by 31,000 jobs in July, while the unemployment rate was unchanged 4.9 percent.

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2022-08-05 16:27:29

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