“All The War Propaganda, All The Screaming And Lies And Hatred Comes Invariably From People Who Are Not Fighting” -George Orwell

TSX Edges Higher While New York Stock Markets Fall

The Toronto Stock Exchange made a slight advance Friday, while New York stock markets shed some of their worth following a tumultuous period after the U.S. presidential election. A lot of the post-Trump impact has now been priced in markets. The markets are now trying to digest what the long-term impact will be and whether this is the beginning of a new major trend based on Trump’s proposed policies.  Stock markets made modest movements in either direction on Friday.  In Toronto, the S&P/TSX composite index gained 37.94 points at 14,864.03. Meanwhile south of the border, markets registered modest declines. The Dow Jones industrial average fell 35.89 points to 18,867.93, the Nasdaq composite slid 12.46 points to 5,321.51, and the broader S&P 500 shed 5.22 points at 2,181.90.
The price of oil made meagre gains. The December contract rose 27 cents to US$45.69 a barrel. The January contract for crude oil, which traded at a higher volume, gained 38 cents to US$46.36 per barrel.  The price of gold, on the other hand, has plummeted to its lowest level since mid-February. The December gold contract fell $8.20 to $1,208.70 per ounce. It last closed below that on Feb. 16 at US$1,208.20.  Rising bond yields and increased expectations that the U.S. Federal Reserve will raise rates, potentially at a faster pace than previously anticipated, is putting pressure on gold prices. On Thursday, Fed chairwoman Janet Yellen hinted at a December interest rate hike when the central bank meets for two days starting Dec. 13. The Canadian dollar fell 0.04 of a U.S. cent at 74.00 cents US.

 

3 Ways Trump’s Victory Could Affect Canada

A Donald Trump administration, combined with a Republican-controlled Senate and House of Representatives, could have reverberations that will be felt by the Canadian economy for years. Here’s a look at what Trump’s victory could mean for various sectors of our economy.
Impact on energy
Remember Keystone XL and the plans to build the 1,900-kilometre pipeline from Alberta to Nebraska?  Trump has said he would “absolutely approve it, 100%.”  Still, when considering Trump’s propensity for categorical statements, one should keep in mind the details. He has said he wants a greater cut of the profits, but hasn’t explained what that means. There’s also TransCanada’s outstanding request for US$15 billion in damages after Obama’s rejection.  Trump is also regarded as a friend of U.S. fossil fuels, on record as favouring oil and gas drilling on federal lands. That could stifle appetite for Canada’s oil and gas production.
What about trade?
Our largest trading partner will soon be led by someone who has committed to ripping up NAFTA if it isn’t renegotiated. Any country can withdraw from the free trade agreement with six months’ notice. And with Republican control of both the legislative and executive branches, Trump is better positioned than past presidents who’ve made similar threats.  But some say he could face resistance from legislators in states that have reaped the benefits of the deal.
Softwood lumber
One of the first trade irritants that could test U.S.-Canadian relations is softwood lumber. A 10-year-old agreement that removed U.S. duties on Canadian softwood lumber expired last month. That paved the way for the possibility of steep taxes, which could result in layoffs throughout Canada’s forestry sector. Trump can expect to face pressure from the U.S. lumber lobby to implement such duties. In an era of rising protectionism, he may be emboldened to oblige.

 

WEEKLY MARKET WRAP-UP

North America
The TSX closed at 14864, up 309 points or 2.12% over the past week. YTD the TSX is up 14.44%.
The DOW closed at 18868, up 20 points or 0.11% over the past week. YTD the DOW is up 8.28%.
The S&P closed at 2182, up 17 points or 0.79% over the past week. YTD the S&P is up 6.75%.
The Nasdaq closed at 5322, up 85 points or 1.62% over the past week. YTD the Nasdaq is up 6.29%.
Gold closed at 1209, down -81.00 points or -1.23% over the past week. YTD gold is up 14.16%.
Oil closed at 45.61, up 2.20 points or 5.07% over the past week.YTD oil is up 23.10%.
The USD/CAD closed at 1.350679, down -0.0035 points or -0.26% over the past week. YTD the USD/CAD is down -2.38%.

Europe/Asia
The MSCI closed at 1707, up 6 points or 0.35% over the past week. YTD the MSCI is up 2.65%.
The Euro Stoxx 50 closed at 3021, down -9 points or -0.30% over the past week. YTD the Euro Stoxx 50 is down -7.56%.
The FTSE closed at 6776, up 46 points or 0.68% over the past week. YTD the FTSE is up 8.55%.
The CAC closed at 4504, up 15 points or 0.33% over the past week. YTD the CAC is down -2.87%.
DAX closed at 10665, down -3.00 points or -0.03% over the past week. YTD DAX is down -0.73%.
Nikkei closed at 17967, up 592.00 points or 3.41% over the past week. YTD Nikkei is down -5.61%.
The Shanghai closed at 3193, down -3.0000 points or -0.09% over the past week. YTD the Shanghai is down -9.78%..

 

Sources: Bloomberg; Investment Executive;  advisor.ca