Oil Stocks- Stocks Hail Earnings, Jump Triple-Digits
Equities in Canada’s largest market opened higher on Friday as material stocks rose tracking gold prices, which were set for their best week in six months on lower dollar and Treasury yields.
The TSX leaped 140.44 points to open the week’s last session at 19,431.42.
The Canadian dollar tailed off 0.07 cents to 82.20 cents U.S.
Cenovus Energy swung to a first-quarter profit from the previous three-month period, as global crude recovered on the back of easing COVID-19 restrictions and vaccine rollouts.
Cenovus shares docked nine cents to $9.63.
Air Canada reported its fifth-straight quarterly loss despite securing a $5.9-billion government aid package, as rising coronavirus infections in parts of the world and travel restrictions limited traffic. The Maple Leaf Airline sprouted wings and flew 24 cents, or 1%, to $24.40.
Berenberg raised the target price on Wheaton Precious Metals to $49 from $47. Wheaton gained 25 cents to $53.40.
Scotiabank raised the target price on AutoCanada to $55.00 from $46.00. AutoCanada shares buoyed 79 cents, or 1.7%, to $46.12.
RBC raised the target price on Imperial Oil to $39.00 from $35.00. IMO shares jumped 49 cents, or 1.3%, to $38.19.
On the economic front, Statistics Canada reported that the economy lost 207,000 jobs in April and the unemployment rate rose 0.6 percentage points to 8.1%.
This followed cumulative employment gains of 562,000 over the previous two months.
Western University’s IVEY School of Business came out later this morning with its Purchasing Managers’ Index for April. The index tumbled to 60.6 in April, lurching below the 72.9 reading in March, but still well above the 22.8 figure for April 2020.
The TSX Venture Exchange registered 8.15 points to open Friday at 951.92.
All 12 subgroups were higher in the first hour, led by health-care, surging 3.8%, materials, improving 1.9%, and information technology issues, 1.7% to the good.
The S&P 500 rose to a new high on Friday even after a disappointing April jobs report as the weak number made investors believe easy monetary policies that powered the market’s historic rebound will stay in place for longer.
The Dow Jones Industrials catapulted 161.14 points to register another intraday record of 34,709.67. The Dow is on track to break a two-week losing streak.
The S&P 500 leaped 33.85 points to 4,235.47.
The NASDAQ Composite skyrocketed 193.36 points, or 1.4%, to 13,826.21.
For the week, the Dow is up more than 2%, while the S&P 500 has gained 1%. The NASDAQ had shed 1.5% so far this week.
The U.S. Labor Department said non-farm payrolls increased by just 266,000 in April, far less than the one million total economists were expecting, according to Dow Jones.
The unemployment rate rose to 6.1% last month amid an escalating shortage of available workers, higher than an expectation of 5.8%. Meanwhile, March’s originally estimated total of 916,000 was revised down to 770,000.
Investors bet that the big jobs miss could keep the easy policies of the Federal Reserve in place, including record low interest rates and a massive bond-buying program.
Tech stocks, which have been winning under the low-rates regime during the pandemic, outperformed after the data release. Facebook, Amazon, Netflix, Alphabet, and Apple all traded in the green. Tesla rose nearly 2%. Higher rates tend to hit growth stocks the most since they reduce the value of their future earnings.
Shares of Roku rallied more than 15% after the streaming company blew past expectations with its first-quarter results. Roku posted adjusted earnings of 54 cents per share, compared to an estimated loss of 13 cents per share. Revenue rose 79% from a year ago and exceeded expectations.
Prices for 10-Year Treasurys gained ground, weighing yields to 1.53% from Thursday’s 1.57%. Treasury prices and yields move in opposite directions.
Oil prices regained 14 cents to $64.85 U.S. a barrel.
Gold prices popped $25.00 to $1,840.70 U.S. an ounce.