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TSX posts record high on rotation into commodity-linked shares

Published 08/26/2024, 06:45 AM
Updated 08/26/2024, 04:41 PM
© Reuters. FILE PHOTO: The Art Deco facade of the original Toronto Stock Exchange building is seen on Bay Street in Toronto, Ontario, Canada January 23, 2019.   REUTERS/Chris Helgren/File Photo
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By Fergal Smith

(Reuters) -Canada's main stock rose to an all-time high on Monday as a jump in oil prices boosted energy shares, and ahead of quarterly earnings this week from five of Canada's six major banks.

The Toronto Stock Exchange's S&P/TSX composite index ended up 62.89 points, or 0.3%, at 23,348.97.

It eclipsed the record closing high posted on Friday when Federal Reserve Chair Jerome Powell endorsed the start of U.S. interest rate cuts.

"It seems like more of a rotation toward commodities and out of some of the technology areas and that's good for the TSX," said Greg Taylor, a portfolio manager at Purpose Investments.

The energy sector climbed 1.6% as the price of oil settled 3.5% higher at $77.42 a barrel, with production cuts in Libya adding to supply concerns. The materials group, which includes metal miners and fertilizer companies, was up 0.2%.

"The rest of the market is just waiting for the banks," Taylor said.

Bank of Nova Scotia and Bank of Montreal are due to report on Tuesday, followed by Royal Bank of Canada and National Bank of Canada (OTC:NTIOF) on Wednesday and Canadian Imperial Bank of Commerce on Thursday.

Last Thursday, Toronto-Dominion Bank reported its first loss in over two decades after setting aside an extra $2.6 billion to cover expected fines from U.S. regulators.

Just two of 10 major sectors posted declines, including technology, which fell 0.6% in sympathy with declines for U.S. tech stocks.

© Reuters. FILE PHOTO: The Art Deco facade of the original Toronto Stock Exchange building is seen on Bay Street in Toronto, Ontario, Canada January 23, 2019.   REUTERS/Chris Helgren/File Photo

A decision obliging more than 9,000 Canadian rail workers to stay on the job is a win for the railways and could impact bargaining in other federally regulated sectors like aviation, the head of a Canadian rail workers' union told Reuters.

Shares of Canadian National Railway (TSX:CNR) Co and Canadian Pacific (NYSE:CP) Kansas City Ltd both ended higher. Air Canada added 0.5%.

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