Canada’s main stock index rose on Tuesday, supported by higher oil prices, after major crude producers showed they were reining in output roughly in line with their commitments.
The S&P/TSX Composite remained in the green 176.71 points, or 1%, to pause for lunch at 17,869.16.
The Canadian dollar gained 0.21 cents to 78.04 cents U.S.
Imperial Oil, one of Canada’s biggest crude producers and refiners, on Tuesday swung to a quarterly loss, dented by impairment charges of $1.17 billion related to abandoned assets in Alberta.
The largest percentage gainers on the TSX were Aphria, which jumped 5.1% and BRP, which rose 4.6%.
First Majestic Silver fell 21.1%, the most on the TSX, as silver prices fell more than 5% after hitting an eight-year high a day earlier. The second biggest decliner was Fortuna Silver Mines, down 13.8%.
Canadian house prices will continue their upwards march this year, outpacing inflation after hitting record highs in 2020, according to a Reuters poll of property market analysts who said the risk of a COVID-19 resurgence derailing activity was low.
ON BAYSTREET
The TSX Venture Exchange sagged 3.69 points to 957.15.
All but three of the 12 TSX subgroups gained ground midday, with health-care sprinting 4%, industrials up 2%, and energy better by 1.8%.
The three laggards were materials, down 2.3%, gold off 1.7%, and consumer staples, slumping 0.1%.
ON WALLSTREET
U.S. stocks jumped on Tuesday, building on a strong rally in the previous session as concerns about a speculative retail trading frenzy continued to ease.
The Dow Jones Industrials hurtled 577.75 points, or 1.9%, to 30,785.45
The S&P 500 gained 64.11 points, or 1.7%, to 3,838.13.
The NASDAQ rose 223.89 points, or 1.7%, to 13,628.71, bringing its week-to-date gains to nearly 4%.
The back-to-back advance on Wall Street coincided with a sharp reversal in GameStop, the video game stock that captivated Wall Street with its massive short squeeze coordinated by a band of retail investors on social media. GameStop, fresh off a 400% rise last week, slid 30% on Monday and fell another 50% Tuesday. The stock has now lost more than half of its value in two days.
Other highly speculative investments popular with the Reddit crowd also started to decline. AMC Entertainment dropped more than 35%. Futures contracts for silver, which enjoyed their biggest one-day jump in 11 years Monday, slid more than 5% Tuesday.
Investors took it as a sign that the speculative mania from retail traders is unwinding, which is healthy for the overall market and investor confidence. The stock market suffered its worst week since October last week as many grew worried the wild trading activity in those heavily shorted names could be contagious and spill over to other areas of the markets.
Investors also awaited big earnings reports Tuesday, with tech giants Amazon and Alphabet set to release quarterly numbers after the market close.
Investors will also be following stimulus negotiations in Washington, where congressional Republicans made a counteroffer to President Joe Biden’s $1.9-trillion stimulus plan on Sunday.
Biden met with those lawmakers on Monday as congressional Democrats moved toward passing a reconciliation bill without bipartisan support. White House press secretary Jen Psaki described the meeting as “substantive and productive.”
Prices for 10-Year Treasurys stumbled, raising yields to 1.1% from Monday’s 1.07%. Treasury prices and yields move in opposite directions.
Oil prices advanced $1.22 to $54.77 U.S. a barrel.
Gold prices subtracted $26.20 to $1,837.70 U.S. an ounce.