TORONTO — Stock markets in Canada and the United States closed higher Wednesday after a directionless day marked by low volumes and a lack of market-moving news.
The gains put markets back on positive footing following a modest pullback on Tuesday from record closes on American markets on Monday, which was a holiday in Canada.
The last trading day of the year is Thursday, New Year’s Eve.
Investors were comforted by positive pandemic news from around the world of more vaccine approvals and deliveries.
Britain authorized the use of a COVID-19 vaccine developed by AstraZeneca and Oxford University which is considered easier to store and handle than others hitting the market. China’s Sinopharm became the latest to release encouraging study results.
A quiet day was welcome considering there could have been steep declines from investors taking profits after the recent U.S. records, said Greg Taylor, chief investment officer of Purpose Investments, in an interview.
“The markets had such a good year and having it flat is probably a bit of a win right now because I think the big fear people have had in the market is that we get some profit-taking ahead of the New Year,” he said.
“It’s a non-event day. Not a lot going on in the market and I think it’s more everyone is getting ready for January and, I think, once we head into that we could see more volatility.”
On Wednesday in Toronto, the S&P/TSX composite index closed up 2.38 points at 17,545.81.
In New York, the Dow Jones industrial average was up 73.89 points at a new record of 30,409.56, while the Nasdaq composite also set a new high-water mark of 12,870.00, up 19.78 points.
The S&P 500 index was up 5.00 points at 3,732.04, short of its 3,735.36 close on Monday.
Investors are starting to anticipate the results of run-off elections in Georgia next week that could potentially determine which party controls the U.S. Senate.
A win for the Democrats could “change the narrative,” Taylor said, making more likely the possibility of bigger stimulus checks, legalization of marijuana and new controls on technology companies and the energy sector.
Despite the small composite index gain, only four of the 11 sectors on the Toronto Stock Exchange were positive on Wednesday, led by mining, marijuana and energy companies.
The February gold contract was up US$10.50 at US$1,893.40 an ounce and the March copper contract was down less than a cent US at $3.55 a pound.
Meanwhile, the February crude contract was up 40 cents US at US$48.40 per barreland the February natural gas contract was down two cents US at about $2.42 per mmBTU.
“We’re bullish on energy heading into the New Year,” said Taylor.
“There’s still a lot of upside here and these companies aren’t really pricing in $50 oil. If we can get to a scenario where that happens, that could be really great environment for the Canadian economy.”
The Canadian dollar traded for 78.31 cents US compared with 78.09 cents US on Tuesday.
— By Dan Healing in Calgary.
This report by The Canadian Press was first published Dec. 30, 2020.
Companies in this story: (TSX:GSPTSE, TSX:CADUSD=X)
The Canadian Press