“An ounce of performance is worth pounds of promises” – Mae West
Toronto Stock Exchange Rises to End a Busy Week
The Toronto Stock Exchange’s S&P/TSX composite index, bolstered by strong Canadian jobs data and gains in the financial sector, rose by 50.12 points to close at 15,473.21 to close out a news-filled week. However, only 3 of the 10 main sectors posted gains for the day.
Statistics Canada reported a substantial rise in employment levels for May. The Canadian workplace added 77,000 new full-time jobs in May. Somewhat ironically, the unemployment rate actually rose to 6.6%, due to an increase in people entering the jobs market. Still, the May jobs numbers offer no sign of a market slowdown, so we can expect the economy to continue its trajectory in the short-term. Job gains for the month were highest in BC, Ontario and Quebec.
On Friday, the Dow Jones Industrial Average closed the week at 21,271.97 on a rise of 89.44 points, the S&P 500 lost 2.02 points to close at 2,431.77 and the NASDAQ slipped by 113.85 to close at 6,207.92.
“Triple Threat Thursday”, Part I
The much-anticipated open-session testimony of former F.B.I. Director James Comey took place on Thursday morning. Mr. Comey testified that he took detailed notes of his meetings with President Trump because he felt Mr. Trump would lie about those meetings. He further asserted that in his opinion, he was directed by Mr. Trump to end the F.B.I. investigation of former National Security Advisor Mike Flynn. Mr. Comey also said he believed he was fired because of the investigation into Russia’s meddling in the 2016 Presidential Election.
Initial reaction to the testimony in the markets appears to have been muted, with some analysts feeling that Mr. Comey’s testimony wasn’t damaging enough to the President to seriously threaten his position; however, it should be noted that Mr. Comey was later questioned by the Senate committee in a classified (closed-session) hearing that could be far more damaging to the Mr. Trump and his administration.
“Triple Threat Thursday”, Part II
European Central Bank chief Mario Draghi signaled that he had no plans to cut back the bank’s stimulus, even though reports of the Euro zone growing rapidly on Thursday morning. Mr. Draghi stated that he expects the ECB will “be in the market for a long time”. His commentary led to a jump in European bonds and a short-lived drop in the Euro and bank shares, as signs of a Euro zone bank rescue in Italy led to a rebound in bank and energy stocks.
“Triple Threat Thursday”, Part III
In what could gently be called a “political gamble gone awry”, British Prime Minister Theresa May’s calling for a snap election – designed to strengthen her majority – did not end the way she’d have liked. She called for an election a month ago, emboldened by a double-digit lead in the polls, and with the goal of silencing those who wanted to stop or reverse the Brexit process.
Her goal gaining on her majority backfired, as the Conservative Party lost 13 seats, dropping from a Majority Government holding 331 seats in the 2015 Election down to a 318-seat Minority Government.
The resulting uncertainty around the Minority Government led to the largest drop in the Pound Sterling in 8 months, before it rebounded slightly on Friday.
Sources: Globe Advisor, Huffington Post, The Guardian