“Cannot People Realize How Large An Income Is Thrift ?” -Cicero

 

Soft Close To A Good Week

The Toronto stock market closed little changed Friday as mining stocks fell alongside prices for gold and copper. The S&P/TSX composite index lost 7.59 points to 12,816..  The Canadian dollar fell 0.36 of a cent to 99.35 cents US. The tumble came a day after closing below parity with the American currency for the first time since mid-November. The loonie has been under pressure since the Bank of Canada indicated Wednesday that any interest rate increases will likely be further down the road than previously expected because of economic weakness. New York was supported by well-received earnings reports from consumer giant Procter and Gamble, oilfield services company Halliburton and from Microsoft.  New York’s Dow Jones industrials was ahead 70.65 points to 13,895.98, the Nasdaq climbed 19.33 points to 3,149.71 while the S&P 500 index rose 8.14 points to 1,502.96.

For the week the TSX was up 88 points or 0.69% while the Dow Jones gained 246 points or 1.8%.

 

Bullish Indicators

Economic data out of China this week continue to suggest the country has been successful is speeding up economic growth while also keeping a lid of inflation. The debt crisis in the U.S. has been kicked months down the road, and the latest data from the country – including on employment and housing – suggest the economy is picking up steam.

Concerns about the European debt crisis are receding. The European Central Bank said lenders will repay more of its loans than economists had expected. The news that the banks will repay $184.3-billion in three-year loans next year,  an indication that they are comfortable in offloading excess liquidit,  helped the euro to strengthen. Japan’s stock market is also back on firmer ground after stumbling earlier this week on disappointment that the Japanese central bank didn’t go far enough in announcing its so called “bold” new monetary stimulus measures. Overnight, the Nikkei soared 2.8 per cent as the yen dropped sharply against the U.S. dollar.

With so many bullish factors, market participants have been growing increasingly concerned about missing out on further rallies, even while being concerned about short-term pullbacks.

 

Sources: Bloomberg, advisor.ca, Investment Executive