Canada’s main stock index ticked lower Thursday amid broad-based weakness, while U.S. markets moved higher, led by the technology sector.
The S&P/TSX composite index was down 40.99 points at 19,942.70.
U.S. stocks closed higher, regaining some of their momentum thanks to a rebound by technology stocks, while volatility dropped to record lows ahead of an eventful economic and policy calendar next week.
In New York, the Dow Jones industrial average was up 168.59 points at 33,833.61. The S&P 500 index was up 26.41 points at 4,293.93, while the Nasdaq composite was up 133.63 points at 13,238.52.
The Canadian dollar traded for 74.86 cents UScompared with 74.76 cents US on Wednesday.
The CBOE Volatility index, also known as Wall Street’s fear gauge, dropped to a fresh post-pandemic record low.
“What you are really seeing in the vol market is an unwillingness to engage,” said David Bianco, Americas chief investment officer for asset manager DWS Group. “You’ve just got paralysis in investors.”
Investors were sitting on the sidelines ahead of inflation data and a Federal Reserve policy meeting next week.
Traders have priced in a 73% chance of the U.S. central bank holding interest rates at the current 5%-5.25% range during its monetary policy meeting on June 13-14, according to CMEGroup’s Fedwatch tool. However, they see a 50% chance of a rate hike in July.
The two-year Treasury yield, which tends to move in step with short-term rate expectations, slipped after a sharp jump in weekly jobless claims signaled a softening labor market.
The U.S. Labor Department is due to release inflation data on June 13, the first day of the Fed meeting. The numbers are expected to show consumer prices cooled slightly in May but core prices remained sticky.
Meanwhile, a rebound by technology and megacap stocks helped major indexes regain their footing amid thin volumes.
Heavyweight Amazon.com Inc gained as Wells Fargo initiated coverage on the company with an “overweight” rating, while Nvidia Corp, Apple Inc and Tesla Inc also advanced.
GameStop Corp tanked as billionaire investor Ryan Cohen took over as executive chairman after the video-game retailer ousted its CEO and posted a bigger-than-expected quarterly loss.
Among the 11 major S&P sectors, consumer discretionary led the charge, while real estate and energy indexes slipped, with the latter being hit by a drop in oil prices.
Adobe jumped after Piper Sandler raised its prices target on the stock to $500. The Photoshop software maker said it was offering its AI tool “Firefly” to large businesses.
Lucid Group tumbled after the U.S. luxury electric-vehicle maker’s head of China operations, Zhu Jiang, said the company was preparing to enter the world’s largest auto market.
Reuters, The Canadian Press