Toronto market nears record high as investors cheer corporate earnings

10/14/2021 | 05:14pm

TORONTO (Reuters) - Canada's main stock index rose for a seventh day on Thursday, reaching a level just short of its record high, boosted by stronger-than-expected corporate earnings and firm economic data as well as higher oil prices.

The Toronto Stock Exchange's S&P/TSX composite index ended up 201.47 points, or 0.98%, at 20,819.94. It was the seventh straight session the index closed higher, the longest winning run since March.

On Sept. 3, the index touched a record closing high of 20,821.43.

"Mainly it's based on better than expected corporate earnings and economic data, which is outweighing fears about inflation and supply chain disruptions," said Stan Wong, director of wealth management and portfolio manager at Scotia Wealth Management.

Canadian factory sales rose 0.5% in August from July, adding to evidence the economy has recovered after a surprise contraction in the second quarter, while the number of Americans filing new claims for unemployment benefits last week fell close to a 19-month low.

Wall Street also ended with strong gains.

The TSX snapped a seven-month win streak in September but the fourth quarter has historically been a friendly period for the market. The index has gained 3.7% so far this month.

"I look at the seasonality trends and they look favorable at this point," Wong said.

The energy group rose 2.2%, helped by higher oil prices. U.S. crude oil futures settled 1.1% higher at $81.31 a barrel after top producer Saudi Arabia dismissed calls for additional OPEC+ supply.

The heavily weighted financial services sector rose 0.9%, while consumer discretionary stocks ended 1.6% higher.

Fashion retailer Aritzia Inc was the largest percentage gainer on the TSX, jumping 17.2% after its quarterly results beat estimates.

Canopy Growth Corp rose 2.5% after saying it would buy weed gummies maker Wana Brands for $297.5 million.

(Reporting by Fergal Smith; Additional reporting by Rithika Krishna in Bengaluru; Editing by Peter Cooney)

By Fergal Smith

© Reuters 2021
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