“One of the penalties for refusing to participate in politics is that you end up being governed by your inferiors” – Plato
TSX Flat, Loonie Rise Continues
The Toronto Stock Exchange’s S&P/TSX composite index closed at 15,180.93 on Friday, a small increase compared to last week’s finish of 15,174.81, although the TSX was down 83.71 points (0.55%) on the day. The Loonie was at 79.76 cents to the USD at time of market close.
Friday’s drop was broad-based, although the energy sector was particularly hard-hit as benchmark crude futures dropped $1.25 USD to close at $45.67.
Investors moved into Gold and U.S. Treasuries – traditionally seen as safe-haven assets – toward the end of the week. Gold jumped to $1,254.80 USD per ounce to end the week.
Wall Street Indices Remain Near Record Highs, Greenback Slumps
The U.S. Dollar sank to its lowest mark in over a year on Friday, as markets tried to make sense of President Trump’s domestic agenda and how he’ll handle another set of obstacles, including the latest collapse and death of the Obamacare “Repeal and Replace” Bill on the Senate floor.
The S&P 500, the Dow Jones Industrial Average (DJIA) and the NASDAQ all backtracked on Friday.
European Central Bank President Mario Draghi Comments on the Euro
On Thursday, the European Central Bank – headed by Mario Draghi – held their key rate at 0%. However, Draghi’s dovish comments did little to stop the Euro from rising to an 8-month high against the Pound Sterling and a 2-year high against the Greenback. Many analysts felt Draghi may try to talk down the currency, but this didn’t happen.
IG market analyst Joshua Mahony offered the following commentary: “It seems Mario Draghi lost some of his shine today, with markets largely ignoring the fact that the ECB governor failed to mention tapering, instead driving the euro higher despite his attempt to drive home a dovish tone.”
Indeed, if the Euro remains strong, the ECB’s target of 2% inflation may not be met.
European stocks dipped to end the week, affected by the Euro’s relative strength.
Sources: Globe Advisor, The Telegraph