Canada’s main stock index closed down on Friday while U.S. markets were mixed as investors eyed issues in Europe and pulled back after a week of big tech gains.
The S&P/TSX composite index ended lower by 59.01 points at 21,639.10, weighed down by telecoms and metals
In New York, the Dow Jones industrial average was down 57.94 points at 38,589.16. The S&P 500 index was down 2.14 points at 5,431.60, while the Nasdaq composite was up 21.32 point at 17,688.88.
“Markets are kind of consolidating today,” said Ian Chong, portfolio manager at First Avenue Investment Counsel.
On the week, the S&P/TSX index was down about 1.7 per cent, a contrast to U.S. markets including the S&P 500 up about 1.6 per cent and the Nasdaq up more than three per cent after a string of earnings and tech news that pushed big names in the sector higher.
“There was some really strong moves in the tech sector,” said Chong, noting that along with Apple regaining its title as the world’s most valuable company, there were strong gains from the likes of Broadcom, Adobe and even Oracle.
“We’re talking about moves of 13 to 15 per cent in some very large-cap companies.”
The moves came both as tech companies released news, and as inflation data out of the U.S. came in lower than expected and the U.S. Federal Reserve held on rates.
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The buzz around the tech sector and AI helps explain why Canada’s market fell behind, said Chong.
“I don’t think there’s anything particularly wrong with Canada, sure, telcos are under a lot of pressure, but it’s more of a value market, right?” he said.
“And the market is just chasing growth and momentum right now and it’s just going after tech names.”
Along with a bit of a pullback overall after a busy week, markets were also reacting to French President Emmanuel Macron’s decision to call a snap election, which has pushed down European stocks.
“There’s a little bit of concern surrounding France’s snap election call, which could be concerning given that it could be a warning regarding the nation’s finances.”
The Canadian dollar traded for 72.72 cents US compared with 72.75 cents US on Thursday.
The July crude oil contract was down 17 cents at US$78.45 per barrel and the July natural gas contract was down seven cents at US$2.89 per mmBTU.
The August gold contract was up US$31.10 at US$2,349.10 an ounce and the July copper contract rose two cents to US$4.50 a pound.
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