TORONTO — North American stock markets ended multi-day losing streaks Thursday by bouncing back from steep morning losses prompted by Russian military action in Ukraine, while gold and crude oil prices softened from early highs.
The turnaround came as U.S. President Joe Biden announced new sanctions that fell short of what some had suggested.
Les Stelmach, portfolio manager at Franklin Templeton Canada, said it usually takes some time for people to digest the true impact of sanctions.
“In the absence of information, usually the market early on you assume the worst and maybe that’s what happened this morning. And as things become a little clearer or information comes out during the course of the day, the expectation’s maybe it’s not as much of a hit as it was originally thought.”
The S&P/TSX composite index closed up 17.76 points at 20,761.93 after shedding more than 300 points or 1.7 per cent of its value in early trading.
U.S. markets were whipsawed even further with the Dow Jones industrial average swinging nearly 1,000 points on the day and closed up 92.07 points at 33,223.83. The S&P 500 index gained 63.20 points at 4,288.70 after losing as much as 2.6 per cent, while the Nasdaq composite surged 436.10 points or 3.3 per cent at 13,473.59 after being down 3.4 per cent.
Technology was the leading sector on the TSX, climbing four per cent as Hut 8 Mining Corp. gained 6.7 per cent and Shopify Inc. was 6.4 per cent higher.
U.S. tech stock also had a good day as investors appeared to buying the recent dip in share prices.
Health care, industrials and utilities were among seven sectors gaining ground. Utilities was pushed higher by share increases for renewable energy producers Boralex Inc., Innergex Renewable Energy Inc. and Brookfield Renewable Partners LP in response to concerns about high energy prices.
Energy increases as crude oil and natural gas prices climbed but the gains were down from the morning. Shares of Tourmaline Oil Corp. and Vermillion Energy Inc. increased 3.2 and 3.1 per cent, respectively.
The April crude contract was up 71 cents at US$92.81 per barrel after briefly cresting the US$100 mark for the first time since 2014, and the April natural gas contract was up 4.8 cents at US$4.64 per mmBTU.
The Canadian dollar traded for 77.93 cents US compared with 78.63 cents US on Wednesday.
Financials was the biggest laggard, losing 1.5 per cent as Canada’s largest banks fell. CIBC shares decreased 3.4 per cent while Royal Bank was down 2.1 per cent despite announcing improved quarterly results.
The bank softness could come from worries that central banks may somewhat pause its plans to raise interest rates next month because of the potential economic impact of the war in eastern Europe, said Stelmach.
“The banks, lifecos would be better positioned I think in the event of rising rates, so if people are maybe taking a second thought about the pace of interest rate increases, that could be explaining why the banks are down both in Canada and the U.S. today.”
The materials sector was also down despite higher gold prices.
The April gold contract was up US$15.90 at US$1,926.3 an ounce after going as high as $1,976.50, and the May copper contract was down 2.8 cents at US$4.46 a pound.
This report by The Canadian Press was first published Feb. 24, 2022.
— With files from The Associated Press.
Companies in this story: (TSX:VET, TSX:TOU, TSX:SHOP, TSX:HUT, TSX:CM, TSX:RY, TSX:BLX, TSX:INE, TSX:BEP. UN, TSX:GSPTSE, TSX:CADUSD=X)
Ross Marowits, The Canadian Press