Lagging commodity prices dragged down the Toronto stock market Friday, while solid jobs data upped the odds of a central bank rate hike and provided a boost to the loonie.
The S&P/TSX composite index lost 50.84 points to 15,027.16, led by gold stocks, which were down 2.26% on lower bullion prices. Meanwhile, the decline in the price of oil caused energy stocks to retreat by 1.46%.
The Canadian dollar gained ground following a stronger-than-expected jobs report that increased the likelihood the Bank of Canada will raise its key interest rate next Wednesday. The loonie was trading at an average price of US77.60¢, up 0.36 of a U.S. cent.
That’s after Statistics Canada reported that the economy added 45,300 jobs last month, nudging the unemployment rate down to 6.5% from 6.6% the previous month.
“The strong jobs number was that final nail in the coffin that increased the odds of a rate hike in Canada. That is going to lead to a stronger loonie,” said Craig Jerusalim, a portfolio manager of Canadian equities at CIBC Asset Management.
In New York, markets were higher after new data showed that the U.S. labour market added 222,000 positions in June — more than analysts had expected. The government also raised its job gains estimates for April and May.
The Dow Jones industrial average gained 94.30 points to 21,414.34. The S&P 500 index climbed 15.43 points to 2,425.18 and the Nasdaq composite index rose 63.62 points to 6,153.08.
In commodities, the August crude contract gave back US$1.29 to US$44.23 per barrel and the August natural gas contract declined US2¢ to US$2.86 per mmBTU.
The August gold contract was down US$13.60 to US$1,209.70 an ounce and the September copper contract lost US2¢ at US$2.65 a pound.