Canada’s main stock index ended a frightening October trading session on a positive by posting a triple-digit gain for a second day in a row.
October is typically a seasonally weak month, but heading into Halloween day trading it was the worst in a decade before the uptick.
The S&P/TSX composite index closed up 132.78 points to 15,027.28 on broad-based gains led by the health-care sector, which includes the big marijuana companies.
“Hallelujah,” said Allan Small, senior investment adviser with HollisWealth. “We had I guess a bit of a relief rally. Whether or not this can be sustained over the longer term remains to be seen.”
It follows Tuesday’s gain of 172.75 points for a 1.17% increase on the Toronto exchange.
Still, the market lost more than 1,000 points or 6.5% in October.
Small is hopeful of gains for the last two months of 2018, but says that is likely not enough to turn around the entire year.
“I think we see perhaps numbers getting a little better as we get into the year-end. Will we turn positive?. That might be a bit of a stretch but there’s always hope, I guess,” he said in an interview.
In New York, the Dow Jones industrial average gained 241.12 points to 25,115.76 for a 5.1% decrease in October. The S&P 500 index was up 29.11 points to 2,711.74 but off 6.9% in the months. The Nasdaq composite rose 144.25 points at 7,305.90 but lost 9.2% in October.
The Canadian dollar traded at an average of US76.09¢ compared with an average of US76.14¢ on Tuesday.
The U.S. markets were helped by good results Tuesday evening by Facebook, followed by strong reports by GM, Estee Lauder and other large companies.
That prompted a wave of buying, just as investors moved in lockstep in the selloff, said Small.
“I don’t think this is the end of the bull market. I think this is a pullback and a correction in a long bull run,” he said, adding that the days of double-digit stock growth are past.
“We have to manage our expectations.”
The December crude contract was down US87¢ at US$65.31 per barrel or off 10.8% in October and the December natural gas contract was up US7.4¢ US$3.26 per mmBTU.
The December gold contract was down US$10.30 at US$1,215.00 an ounce and the December copper contract was up half a cent at US$2.66 a pound.