Canadian Financial Close: Stocks rise on US tax reform talk

By Commodity News Service Canada

WINNIPEG, Oct. 5 — Stock markets continued their rapid rise Thursday, as investors looked favourably at U.S. tax reform plans and economic outlooks worldwide.

The Dow Jones, S&P 500 and Nasdaq were all up as were equity markets in 47 countries monitored by the benchmark MSCI world stock fund index.

The Canadian dollar slipped back below the 80 cents U.S. mark, on news of Canada’s increasing trade deficit, which cast further doubt on the chance the Bank of Canada would announce another interest rate increase in 2017.

The loonie closed today at 79.69 cents U.S., or C$1.2548 per US$1. It closed yesterday at 80.13 cents U.S., or C$1.2479 per US$1.

TransCanada has shelved its C$15.7 billion Energy East Pipeline plan, citing a slowdown in oil sands activity and greater environmental scrutiny. The pipeline planned to deliver 1.1 billion barrels per day of western crude oil to refineries in Quebec and New Brunswick and to an export terminal in New Brunswick.

Canada’s trade deficit increased in August, according to Statistics Canada, providing key evidence that the national economy is slowing. The merchandise trade deficit reached C$3.4 billion in August, compared to C$3 billion in July, surpassing analysts’ expectations for C$2.6 billion. While some analysts say it is sign Canada’s economy is slowing, others say it is temporary, with exports being slower due to hurricanes in the United States.

The S&P/TSX gained 55.30 points (0.35%) to close at 15,776.30. The S&P 500 gained 12.87 points (0.51%) to 2,551.58, the Dow climbed 96.86 points (0.43%) to 22,775.39 and the Nasdaq gained 47.44 points (0.73%) to 6,585.36.

WTI crude gained 75 cents U.S. a barrel, an increase of 1.50%, to close at US$50.73 per barrel.

Canada’s agricultural sector performed as follows:

AGT Food and Ingredients—–dn $ 0.07 at $ 24.32
Agrium Incorporated———-up $ 0.05 at $133.63
Buhler Industries————– $ 0.00 at $ 4.59
Maple Leaf Foods————-dn $ 0.13 at $ 34.81
Potash Corp. of Sask———dn $ 0.015 at $ 24.005

(All figures are in Canadian dollars.)

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