Canada Stocks: Resource shares lift Toronto market to near 2-year high

Nexgen Energy

01/03/2024 21:23

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      TSX closes up 0.9% at 21,552.35
    

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      Posts highest closing level since April 2022
    

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      Energy rallies 2%; oil settles up 2.2%
    

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      Uranium producers rally; NexGen Energy up 9.5% 
    

  
 (Updates at market close)
    By Fergal Smith
       March 1 (Reuters) - Canada's main stock index climbed to
a near two-year high on Friday, led by gains for resource and
technology shares, as investors grew more optimistic about
prospects for Federal Reserve interest rate cuts over the coming
months.
    The Toronto Stock Exchange's S&P/TSX composite index
 .GSPTSE  ended up 188.74 points, or 0.9%, at 21,552.35, its
highest closing level since April 2022. For the week, the index
was up 0.7%.
    "We are back on that roller coaster ride of interest rate
expectations driving the market," said Philip Petursson, chief
investment strategist at IG Wealth Management. "Today, some of
the softer data out of the United States rekindled the fire of
expectation for the Fed cut being sooner rather than later."
    U.S. manufacturing slumped further in February, with a
measure of factory employment falling to a seven-month low amid
layoffs, but there were signs activity was on the cusp of
rebounding.
    Higher commodity prices boosted resource shares, with gold
 XAU=  rising 2%, copper  HGc1  up 0.5% and oil settling 2.2%
higher at $79.97 a barrel.
    "With the expectations of the Fed cutting interest rates,
that's putting a little bit of downward pressure on the U.S.
dollar and you get the inverse relationship of higher commodity
prices," Petursson said.
    The energy sector and materials, which includes which
includes precious and base metals miners and fertilizer
companies, both added 2%.
    Uranium producers contributed to the rally, with NexGen
Energy Ltd  NXE.TO  up 9.5% and Cameco Corp  CCO.TO  advancing
3.5%, after Reuters reported on Thursday that Canada will
expedite the approval process for new nuclear projects.
    The information technology sector also posted strong gains,
climbing 1.5% and industrials were up 0.7%.
    Shares of SNC-Lavalin Group Inc  ATRL.TO  jumped 11.4% after
the construction and engineering company reported fourth-quarter
results that beat estimates.

 (Reporting by Fergal Smith in Toronto and Purvi Agarwal in
Bengaluru; Editing by Vijay Kishore and Alistair Bell)
 ((fergal.smith@thomsonreuters.com; +1 647 480 7446))