Economy & Markets

Price of oil cruises past US$60 mark

By David Hodges |
Source: The Canadian Press

Crossing the US$60 oil barrier wasn't enough to steer the Toronto stock index out of the red ahead of the New Year's Eve holiday weekend, as Canadian cannabis companies experienced a volatile trading day.

The February crude contract climbed US58¢ to US$60.42 per barrel on Friday, its highest level since June 24, 2015.

Despite oil's momentum, energy stocks fell on the S&P/TSX composite index, declining 12.82 points to 16,209.13 as the TSX retreated from its two-day record streak. On Wednesday and Thursday, the commodity-heavy index closed at all-time highs of 16,203.13 and 16,221.95, respectively.

"It's a bit mixed," Steve Belisle, a senior portfolio manager of equities at Manulife Asset Management, said of the divergence between crude prices and oil and gas stocks.

"That said, a lot of focus is put on the spot prices on the short end of the curve but what's important is the long of the curve and where it's heading. ... Stocks have already been pricing in higher crude prices."

Moreover, Belisle added, "it's pretty quiet day in terms of volume. Any movement you're seeing must taken with a grain of salt."

Included in the TSX's broad-based decline was the health-care sector after major pot producers such as Canopy Growth Corp. and Aurora Cannabis Inc. had their stocks temporarily halted earlier Friday after share prices dropped by nearly 15% within a short time frame.

Canopy Growth and Aurora, as well as other marijuana companies, recovered most or all of their losses at the end of trading on Friday. Aurora closed at $9.60, up 66¢ or 7.38%, while Canopy was down 2.2% or 67¢ at $29.74.

South of the border, U.S. stock indexes experienced modest losses on the final day of trading for 2017.

In New York, the Dow Jones industrial average fell 118.29 points to 24,719.22. The S&P 500 index was down 13.93 points to 2,673.61 and the Nasdaq composite index gave back 46.77 points to 6,903.39.

The Canadian dollar closed at an average trading value of US79.71¢ , up 0.27 of a U.S. cent.

Elsewhere in commodities, the February natural gas contract gained US4¢ to US$2.95 per mmBTU. The February gold contract climbed US$12.10 to US$1,309.30 an ounce and the March copper contract was down US1¢ to US$3.30 a pound.

North American stock markets will be closed Monday.