Toronto stock market hits six-month high on rise in crude oil price

Ross Marowits, The Canadian Press
Published Monday, March 18, 2019 4:38PM EDT
Last Updated Monday, March 18, 2019 5:00PM EDT

TORONTO — Canada’s main stock index returned to its highest closing in nearly seven months on Monday as the price of oil surpassed US$59 per barrel for the first time since November.

The S&P/TSX composite index closed up 111.02 points to 16,251.37. That’s the highest level since last August and just 1.9 per cent off its all-time high set last July.

The Toronto market has slowly been creeping up since a blockbuster first two months of the year that nearly recovered all losses from late last year.

There’s a chance the TSX will set a new record in the coming weeks but will likely consolidate just short of that high until spurred by another catalyst, says Mike Archibald, associate portfolio manager with AGF Investments Inc.

He says the market has been fairly steady in March, rising 1.6 per cent so far in the month after gaining 12.5 per cent in January and February.

The market was helped Monday by a 2.3 per cent hike in the health care sector as Green Organic Dutchman Holdings Ltd. and Hexo Corp. led the cannabis stocks.

The key energy sector rose 1.9 per cent on the back of OPEC cancelling its April meeting, leaving oil supply cuts in place until at least June.

The May crude contract for U.S. West Texas Intermediate crude was up 56 cents to US$59.38 per barrel. That’s the highest price since Nov. 12. The energy sector was also helped by the April natural gas contract gaining 5.5 cents at US$2.85 per mmBTU.

The financial sector was up 0.87 per cent as Manulife Financial Corp. rose 3.1 per cent after it announced that a Saskatchewan court ruled in its favour in its

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UnitedHealth Shares Finding Their Mojo Again

© Reuters.

Investing.com – UnitedHealth Group (NYSE:) has been a big reason why the has held its own lately.

The world’s largest health-insurance company was the Dow’s best performer last week, up 6.73% adding 108 points to the index by itself. It was up another 1% today.

UnitedHealth’s rebound came after falling 3.6% two weeks ago in a crummy week for stocks generally. The Dow, and all fell for five-straight days.

The UnitedHealth rally is part of the easing of recent selling pressure on health stocks generally.

The Health Care Select Sector SPDR (NYSE:) ETF was up 1.7% last week after falling 3.8% the week before. UnitedHealth represents nearly 7% of the Health Care ETFs assets, third-largest after Johnson & Johnson (NYSE:) and Pfizer (NYSE:).

The selling in health stocks seemed prompted by investor panic over the push by Democrats on health-care-for-all plans. But many analysts noted that, even if a plan was passed by the House of Representatives, it would face intense industry opposition, with UnitedHealth a big leader, and will get nowhere in a GOP-ruled Senate.

The company serves some 115 million customers with its various coverage plans. In addition, it has a large pharmacy benefit management business that negotiates substantial rebates from drug companies and passes the rebates on to customers.

Analysts love the stock.

Twenty-four of 25 analysts tracked by Investing.com rate UnitedHealth a buy. The consensus is that the stock could top $307 in the next 12 months, a 22% gain from current levels. Technical measures also tracked by Investing.com rate the stock a strong buy.

UnitedHealth has been a star performer among the 30 Dow stocks in recent years as earnings and revenue routinely beat estimates. In 2017, it soared nearly 38%. In 2018, the stock rose just 13%, but that included a

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Stocks – S&P 500 Ends Higher, Powered by Surge in Energy Stocks

© Reuters.

Investing.com – The S&P 500 closed higher Monday as gains in energy and consumer discretionary stocks helped offset falls in shares of Boeing and Facebook.

The rose 0.25%, the gained 0.38%, while the added 0.34%.

Wall Street got the week off to a modestly winning start powered by rising energy stocks as oil prices settled 1% higher after Saudi Arabia said it may need to extend oil supply cuts beyond June into the second half of 2019.

Rising consumer discretionary stocks added to gains in the broader market, led by Amazon.com (NASDAQ:), as the e-commerce giant’s planned second headquarters in northern Virginia won approval from local officials. A surge in shares of Caesars Entertainment (NASDAQ:) also firmed up consumer discretionaries amid reports the casino operator was in the early stages of exploring a merger with Eldorado Resorts (NASDAQ:).

The communications services sector was an exception to the generally buoyant mood as Facebook (NASDAQ:) fell 3.3% after a downgrade from Needham.

Needham cut its rating on the social media giant from buy to hold amid worries about the financial impact of the company’s pivot towards privacy and encrypted messages. Concerns about growing regulation risks weighed on the shares. The concern: More regulation could hamper the company’s ability to monetize its data.

The social media giant has seen its stock rebound 22% so far this year from the hammering it took in 2018, but remains some 27% below its 52-week high.

Boeing (NYSE:) cut some of its early losses, easing downside pressure on industrials, but the aerospace giant still ended the day 1.8% lower as French accident investigator BEA said the flight data recorder from the Ethiopian Airlines 737 Max’s black box showed “clear similarities” between the deadly crash on March 10 and a previous Boeing 737 Max crash

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Gary Shilling: Stocks to Plunge 21 Percent When Next Recession Hits

I first suggested the U.S. economy was headed toward a recession more than a year ago, and now others are forecasting the same. I give a business downturn starting this year a two-thirds probability.

The recessionary indicators are numerous. Tighter monetary policy by the Federal Reserve that the central bank now worries it may have overdone. The near-inversion in the Treasury yield curve. The swoon in stocks at the end of last year. Weaker housing activity. Soft consumer spending. The tiny 20,000 increase in February payrolls, compared to the 223,000 monthly average gain last year. Then there are the effects of the deteriorating European economies and decelerating growth in China as well as President Donald Trump’s ongoing trade war with that country.

There is, of course, a small chance of a soft landing such as in the mid-1990s. At that time, the Fed ended its interest-rate hiking cycle and cut the federal funds rate with no ensuing recession. By my count, the other 12 times the central bank restricted credit in the post-World War II era, a recession resulted.

It’s also possible that the current economic softening is temporary, but a revival would bring more Fed restraint. Policy makers want higher rates in order to have significant room to cut in the next recession, and the current 2.25 percent to 2.50 percent range doesn’t give them much leeway. The Fed also dislikes investors’ zeal for riskier assets, from hedge funds to private equity and leveraged loans, to say nothing of that rankest of rank speculations, Bitcoin. With a resumption in economic growth, a tight credit-induced recession would be postponed until 2020.

“Recession” conjures up specters of 2007-2009, the most severe business downturn since the 1930s in which the S&P 500 Index plunged 57 percent from its peak to its trough.

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Stocks are poised for an 18% hit, warns economist who nailed last financial crisis

Gary Shilling has a knack for predicting turns in the economy. The former chief economist for Merrill Lynch did it in the 1960s. Again in 1991. And then, leading up to the financial crisis in 2008, he consistently warned the housing boom would turn to bust. We all know how that one turned out.

Now, he’s making another call.

“I give a business downturn starting this year a two-thirds probability,” he wrote in a Bloomberg News op-ed. “The recessionary indicators are numerous.”

Shilling, portfolio manager and president of A. Gary Shilling & Co., pointed to factors such as the near-inversion in the Treasury yield curve, the nasty December for stocks, weaker housing activity, soft consumer spending, etc.

“Then there are the effects of the deteriorating European economies and decelerating growth in China as well as President Donald Trump’s ongoing trade war with that country,” Shilling said.

He explained that it’s possible the current economic softening is temporary, but cautioned that even if it starts to heat back up, it would trigger Fed restraint.

“Policy makers want higher rates in order to have significant room to cut in the next recession, and the current 2.25% to 2.50% range doesn’t give them much leeway,” Shilling wrote. “The Fed also dislikes investors’ zeal for riskier assets, from hedge funds to private equity and leveraged loans, to say nothing of that rankest of rank speculations, bitcoin BTCUSD, +0.03%  .”

He said that if growth resumes, “a tight credit-induced recession would be postponed until 2020.”

Shilling doesn’t see any major bubbles that are immediately “begging to be pricked,” so he’s looking for the upcoming bear market to bring about more of a “normal recession-related decline” of about 18% from Friday’s closing level.

That would surely sting, but that kind of decline would still be a

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Wall Street ends higher, with biggest boost from banks

NEW YORK (Reuters) – Banks and tech helped lead Wall Street higher on Monday, while Boeing and Facebook were a drag and investors eyed this week’s U.S. Federal Reserve meeting for affirmation of its commitment to “patient” monetary policy.

Following the S&P 500’s best week since November, the benchmark index ended the session about 3.3 percent below its all-time high reached in September. All three major U.S. indexes closed in positive territory.

The Dow’s fourth straight advance ran into headwinds from Boeing Co, which fell 1.8 percent as the company faced increasing scrutiny following a fatal crash in Ethiopia on March 10. The drop in shares of the world’s largest plane maker extended last week’s 10.3 percent decline and was the heaviest weight on the blue-chip index.

The Fed’s two-day policy meeting begins on Tuesday. Investors anticipate the U.S. central bank will reinforce its dovish approach toward further interest rate hikes.

“There’s always trepidation going into a Fed meeting,” said Tim Ghriskey, chief investment strategist at Inverness Counsel in New York. “Anything that gives visibility to the potential for future rate hikes is going to keep people on the sidelines.”

The Dow Jones Industrial Average rose 65.23 points, or 0.25 percent, to 25,914.1, the S&P 500 gained 10.46 points, or 0.37 percent, to 2,832.94 and the Nasdaq Composite added 25.95 points, or 0.34 percent, to 7,714.48.

Of the 11 major sectors in the S&P 500, eight closed in the black, with energy, consumer discretionary and financial companies enjoying the biggest percentage gains.

The prospect of extended OPEC supply cuts sent crude prices to four-month highs, which boosted energy companies, while news of upcoming initial public offerings (IPOs), notably from ride-hailing service Lyft, sent the banking sector higher.

“With markets close to all-time highs again, you see IPOs popping out of

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Fed Steps To Plate This Week But Not Expected To Swing Bat As Rate Drama Muted

(Monday Market Open) Fed week is upon us once again, and it starts with the (SPX) near its highest level in months and Treasury yields near their lowest. Though there’s little drama around the Fed’s meeting Tuesday and Wednesday, it’s probably going to be closely watched in what appears to be a slow news cycle.

The new week also begins with Boeing (NYSE:) shares under more pressure following reports over the weekend that the U.S. government might investigate the Federal Aviation Administration’s (FAA) approval of Boeing’s 737 Max planes. Boeing shares fell 2% in pre-market trading.

If BA shares keep sliding today, that could set up a dichotomy like the one we saw last week in which the ($DJI)—where BA is a prominent member—moves out of sync with the SPX. That’s how things looked in the early going, with the DJI falling in pre-market trading and the SPX up. That came after a jump in Asian stocks earlier Monday as optimism continued about possible progress in U.S./China trade negotiations.

Though the Fed might be one focus this week and BA another, make no mistake: The China tariff situation is likely to remain top of mind for the market until there’s some kind of resolution.

On the commodities front, crude futures were initially a little lower early Monday before ticking up slightly after news that OPEC would cancel its April meeting. According to the organization, the meeting is being canceled because it expects the oil market to remain oversupplied through the first half of the year, CNBC reported early Monday. OPEC also apparently wants more time to assess the impact of U.S. sanctions on Iran and Venezuela.

This just happened, but one possible ramification is that any hopes for OPEC to turn up the spigots next month might have just gotten

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Wall Street inches higher ahead of Fed policy meeting

NEW YORK (Reuters) – Wall Street edged higher on Monday as declines in Boeing and Facebook held gains in check and investors eyed this week’s Federal Reserve meeting for affirmation of the central bank’s commitment to “patient” monetary policy.

FILE PHOTO: A trader works on the floor at the New York Stock Exchange (NYSE) in New York, U.S., March 13, 2019. REUTERS/Brendan McDermid

Coming on the heels of the S&P 500’s best week since November, the benchmark index currently hovers about 3.4 percent below its all-time high reached in September. All three major U.S. indexes were in positive territory.

“People were so pessimistic around year-end, but the market has since had a tremendous rebound and now we’re in a wait-and-see phase,” said Peter Tuz, president of Chase Investment Counsel in Charlottesville, Virginia.

The Dow’s nominal advance was hindered by Boeing Co, which fell 2.0 percent as the company faced increasing scrutiny regarding safety of its 737 MAX planes following a fatal crash in Ethiopia on March 10. The world’s largest plane maker extended last week’s 10.3 percent decline and was the heaviest weight on the blue-chip index.

On Tuesday the U.S. Federal Reserve’s two-day policy meeting begins. Investors expect the central bank to reinforce its “patient” approach toward further interest rate hikes.

“Whatever the Fed says could move the market,” Tuz added. “We think that (the Fed is) on hold for the time being.”

Brexit helped curbed investor optimism as Great Britain’s speaker of Parliament warned that Prime Minister Theresa May’s deal would not be put to a vote unless it took a substantially different form.

The Dow Jones Industrial Average rose 31.79 points, or 0.12 percent, to 25,880.66, the S&P 500 gained 8.17 points, or 0.29 percent, to 2,830.65 and the Nasdaq Composite added 21.45 points, or 0.28 percent, to

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A recession is coming — and maybe a bear market, too

I first suggested the U.S. economy was headed toward a recession more than a year ago, and now others are forecasting the same. I give a business downturn starting this year a two-thirds probability.

The recessionary indicators are numerous. Tighter monetary policy by the Federal Reserve that the central bank now worries it may have overdone. The near-inversion in the Treasury yield curve. The swoon in stocks at the end of last year. Weaker housing activity. Soft consumer spending. The tiny 20,000 increase in February payrolls, compared to the 223,000 monthly average gain last year. Then there are the effects of the deteriorating European economies and decelerating growth in China as well as President Donald Trump’s ongoing trade war with that country.

There is, of course, a small chance of a soft landing such as in the mid-1990s. At that time, the Fed ended its interest-rate hiking cycle and cut the federal funds rate with no ensuing recession. By my count, the other 12 times the central bank restricted credit in the post-Second World War era, a recession resulted.

It’s also possible that the current economic softening is temporary, but a revival would bring more Fed restraint. Policy makers want higher rates in order to have significant room to cut in the next recession, and the current 2.25 per cent to 2.50 per cent range doesn’t give them much leeway. The Fed also dislikes investors’ zeal for riskier assets, from hedge funds to private equity and leveraged loans, to say nothing of that rankest of rank speculations, Bitcoin. With a resumption in economic growth, a tight credit-induced recession would be postponed until 2020.

“Recession” conjures up spectres of 2007-2009, the most severe business downturn since the 1930s in which the S&P 500 Index plunged 57 per cent from its

Read More Here...

Stocks edge higher ahead of Fed meeting; Boeing drags on Dow

U.S. stocks traded modestly higher Monday, as investors looked ahead to this week’s meeting of Federal Reserve policy makers, while losses for aircraft maker Boeing again dragged on the Dow Jones Industrial Average.

How are the major indexes trading?

The Dow Jones Industrial Average DJIA, +0.24%  rose 28 points, or 0.1%, to 25,876, while the S&P 500 index SPX, +0.35% ticked 7 points higher to 2,830, a gain of roughly 0.3%. The Nasdaq Composite Index COMP, +0.29% rose 13 points, or 0.2%, to 7,701.

Investors were catching their breath following a rally last week that took the S&P 500 above long-term resistance at 2,800. The S&P rose 2.9% last week to end Friday at 2,822.48. The Dow rose 1.6% last week to close Friday at 25,848.87 and the Nasdaq Composite added 3.8% to end at 7,688.53.

The S&P and Nasdaq posted their highest settlements since Oct. 9, while the Dow ended at its highest level since March 1.

What’s driving the market?

YMM9, +0.22% The Federal Reserve is expected to leave rates unchanged when it concludes a two-day meeting on Wednesday, but attention will be focused on the statement issued by policy makers, Chairman Jerome Powell’s remarks at a news conference following the meeting and the updated interest-rate forecasts provided by policy makers in the so-called dot plot.

Most economists look for the Fed to lower its projected path on interest rates to one hike in 2019 and one more in 2020, while maintaining the dovish, wait-and-see stance it adopted in January — a shift that was credited with helping accelerate a rebound by U.S. equities from a December selloff.

Read: Fed seen revealing ‘how and when’ it will stop shedding balance sheet assets

Investors continue to keep an eye on U.S.-China trade talks. A proposed summit between President Donald

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