Canada's Stock Market Rises on Strong Labour Data
The Canadian stock market rose nearly 250 points on Friday following strong labour data from both Canada and the US. The S&P/TSX composite index was up 244.92 points at 36,381.23.
The domestic job market took a leap towards recovery in July, with Statistics Canada reporting that the unemployment rate edged lower to 6.4 per cent as the economy added 75,000 jobs. This was above expectations, with a Reuters poll ahead of the release showing Bay Street expecting a modest 15,000-job gain.
Economists say there's still a long road ahead before the Bank of Canada considers tightening policy. Allan Small, senior investment adviser at iA Private Wealth, said 'I would be hoping for interest rate cuts, but with strong jobs data and inflation slightly above target on the headline number... I think the Bank of Canada just stands pat.' He added that financial market odds were about 96 per cent in favour of a hold from the Bank of Canada at its September 2 meeting.
The US government reported that employers unexpectedly cut 23,000 jobs last month. This could reduce the odds of a rate hike from the US Federal Reserve. The December gold contract was up US$100.10 at US$4,399.70 an ounce, amid weaker employment data from the US and rising gold prices.