Canadian stocks continued to rise Tuesday, with the S&P/TSX Composite Index closing above 16,000 for the second consecutive day.
The TSX Composite was up, a new record high. The modest advance was again powered by gains in the energy sector, while financials edged higher after a healthy check-up from ratings agency Fitch.
Energy stocks jumped 1.3%. Crude oil futures continued to surge Tuesday, with London’s Brent crude touching its highest in two years.
U.S. WTI light sweet crude oil, meanhwhile, added 23 cents to settle at $54.38 a barrel, the highest since February.
Oil prices have surged on speculation OPEC will extend its supply quota deal with Russia. The cartel meets in Vienna November 30. Also, encouraging U.S. economic data raised demand expectations for energy products.
In lackluster economic news, Canada’s real gross domestic product edged down 0.1% in August, after being essentially unchanged in July. Declines in manufacturing and mining, quarrying and oil and gas extraction more than offset increases in most sectors, Statistis Canada said.
Ratings agency Fitch maintained its highest rating on the Canadian banking sector, but singled out CIBC (CM.TO) with a negative outlook due to exposure to risky mortgages.
“Uncertainties remain regarding the potential impact of recent mortgage reform announcements on the broader mortgage market,” Fitch said in a report. “As such, a faster price correction that is prolonged and/or a slowdown in the housing market will likely impact earnings growth for all the banks.
“CIBC has the largest exposure to Canadian consumers at 76.9 percent of total Canadian loans compared to the “Big Six” Canadian banks’ peer average of 66.8 per cent,” Fitch said.
CIBC shares dropped 0.6%.
WestJet (WJA.TO) reported a strong quarterly profit as passenger traffic rose. Shares slipped 0.5%.
The material has been provided by InstaForex Company – www.instaforex.com
The post TSX Consolidates Above 16,000, Energy Stocks Are Hot — Canadian Commentary appeared first on forexarabicnetwork.com.