Economy gains but energy stocks slump... Canadian economy gains in March... IMF flags new housing market concern...
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Economy gains but energy stocks slump
Growth for the Canadian economy may have been the highlight of the session but continued decline for oil prices this week hit the energy sector again Wednesday.
The energy sector group of the main TSX index led 7 sectors lower with telecoms, IT and utilities gaining.
Element Fleet Management was one of the session’s key losers following speculation that it was about to be shorted by activist short seller Muddy Waters LLC. Asanko Gold Inc. was later revealed as the subject of a tweeted ‘tease’.
Wall Street also closed lower with European and Asian indexes mixed.
The S&P/TSX Composite Index closed down 22.44 (0.15 per cent)
The Dow Jones closed down 20.82 (0.10 per cent)
Oil is trending higher (Brent $50.29, WTI $48.22 at 4.15pm)
Gold is trending lower (1271.20 at 4.15pm)
The loonie is valued at U$0.7401
Canadian economy gains in March
Canada’s GDP was up 0.5 per cent in March following a flat February; and was up 0.9 per cent in the first quarter, following a 0.7 per cent gain in the last three months of 2016, Statistics Canada reported.
There were widespread gains for the March data with goods producing industries gaining 0.9 per cent and service industries up 0.3 per cent. Manufacturers were up 1.6 per cent following a 1 per cent contraction in February.
Retail, construction, real estate and the finance sector were all among those that gained.
However, analysts suggest that the strength in the economy could trigger an interest rate rise sooner than the 2018 expectation.
IMF flags new housing market concern
The IMF has warned of “significant” risks from Canadian household debt and the housing market which could hit economic growth.
In a statement, the IMF commented: “Credit ratings of Canada’s six largest banks were lowered recently, reflecting concern that high household debt and the rapid appreciation of house prices could weaken asset quality in the future.”
The organization was critical of the foreign-buyers’ tax approach to cooling housing markets and said that deterring speculative buyers would be a better measure.
Growth for the Canadian economy may have been the highlight of the session but continued decline for oil prices this week hit the energy sector again Wednesday.
The energy sector group of the main TSX index led 7 sectors lower with telecoms, IT and utilities gaining.
Element Fleet Management was one of the session’s key losers following speculation that it was about to be shorted by activist short seller Muddy Waters LLC. Asanko Gold Inc. was later revealed as the subject of a tweeted ‘tease’.
Wall Street also closed lower with European and Asian indexes mixed.
The S&P/TSX Composite Index closed down 22.44 (0.15 per cent)
The Dow Jones closed down 20.82 (0.10 per cent)
Oil is trending higher (Brent $50.29, WTI $48.22 at 4.15pm)
Gold is trending lower (1271.20 at 4.15pm)
The loonie is valued at U$0.7401
Canadian economy gains in March
Canada’s GDP was up 0.5 per cent in March following a flat February; and was up 0.9 per cent in the first quarter, following a 0.7 per cent gain in the last three months of 2016, Statistics Canada reported.
There were widespread gains for the March data with goods producing industries gaining 0.9 per cent and service industries up 0.3 per cent. Manufacturers were up 1.6 per cent following a 1 per cent contraction in February.
Retail, construction, real estate and the finance sector were all among those that gained.
However, analysts suggest that the strength in the economy could trigger an interest rate rise sooner than the 2018 expectation.
IMF flags new housing market concern
The IMF has warned of “significant” risks from Canadian household debt and the housing market which could hit economic growth.
In a statement, the IMF commented: “Credit ratings of Canada’s six largest banks were lowered recently, reflecting concern that high household debt and the rapid appreciation of house prices could weaken asset quality in the future.”
The organization was critical of the foreign-buyers’ tax approach to cooling housing markets and said that deterring speculative buyers would be a better measure.
