How High can TSX Go? - InvestingChannel

How High can TSX Go?

And the beat goes on… equities in Toronto rose as the clock approached noon EDT Wednesday as railroad stocks jumped after regulators halted Canadian National’s deal to buy U.S. peer Kansas City Southern, potentially paving the way for rival Canadian Pacific to usurp the deal.

The TSX Composite Wednesday rumbled 108.89 points to 20,691.83.

The Canadian dollar faded 13 cents to 79.25 cents U.S.

The U.S. rail regulator on Tuesday rejected a voting trust structure that would have allowed CN to proceed with its $29-billion proposed acquisition of U.S. peer Kansas City Southern.

CN shares vaulted $8.21, or 5.5%, to $156.61, while those for Kansas City Southern climbed $7.62, or 2.7%, in New York, to $288.29.

Meantime, CIBC raised the price target on CN to $158.00 from $145.00

Capstone Mining CS.TO and Torex Gold Resources TXG.TO

were the biggest percentage decliners on the TSX.

On the economic slate, in the meeting between the Organization of the Petroleum Exporting Countries and allies, the producer club is expected to stick to a plan to add 400,000 barrels per day each month through to December.

IHS Markit Canada‘s seasonally- adjusted Manufacturing Purchasing Managers’ Index registered 57.2 in August, up from 56.2 in July. The latest reading extended the period of growth to 14 successive months, with the latest expansion the fourth quickest in the near 11-year history of the survey.

On the campaign trail, Conservatives hammered Prime Minister Justin Trudeau on Tuesday after data showed that the country’s economy unexpectedly shrank in the second quarter and again in July, putting the economy at the center of debate three weeks ahead of a national election.

ON BAYSTREET

The TSX Venture Exchange improved 6.01 points to 902.55

Seven of the 12 TSX subgroups were positive midday with industrials booming 1.9%, information technology better by 1%, and real-estate moving ahead 0.5%.

The five laggards were weighed most by materials and health-care, each down 0.4%, while gold slumped 0.2%.

ON WALLSTREET

The Dow Jones Industrials remained negative 23.36 points to adjourn for lunch at 35,337.37.

The S&P 500 gained 7.9 points to 4,530.58.

The index has had a pretty smooth ride so far in 2021, up more than 20% without even a 5% pullback. The benchmark has closed above its 200-day average, for 296 days in a row.

The NASDAQ Composite leaped 101.17 points, to 15,360.40, to an all-time high.

The major averages all finished higher for the month of August. The S&P 500 rose 2.9% for the month, posting its best winning streak since 2017. The NASDAQ gained about 4% for its third positive month and while the Dow lagged, it still added 1.2%.

Solar stock Sunrun surged 7% after JPMorgan predicted a comeback that would take the shares 90% higher.

Zoom Video shares rebounded 2.8% following a 16% plunge Tuesday after Cathie Wood revealed she bought nearly 200,000 shares on the dip.

Investors digested a disappointing employment report. U.S. companies created far fewer jobs than expected in August with private payrolls rising just 374,000, according to payroll services firm ADP. That is well below the Dow Jones estimate of 600,000.

The report is a precursor to the official August U.S. non-farm payrolls data, which will be released Friday. Economists polled by Dow Jones expect 720,000 jobs were created in August and the unemployment rate fell to 5.2%.

Prices for 10-Year Treasurys were moved higher, lowering yields to 1.30% from Tuesday’s 1.31%. Treasury prices and yields move in opposite directions.

Oil prices slid 77 cents to $67.73 U.S. a barrel.

Gold prices fell 80 cents to $1,817.30 U.S. an ounce.