TSX Futures Rise as Oil Slips

Futures tracking Canadian equities rose on Monday after a dip in oil prices tempered inflation worries. Crude fell on hopes for US-Iran diplomatic efforts, and lower oil prices somewhat eased inflation concerns, with Canadian yields edging lower. Credit-sensitive sectors such as banks that have been pressured by inflation and higher interest rates enjoyed respite. Gold prices rose, supporting miners. Barrick posted higher third-quarter profit as higher gold prices outweighed lower production. Franco-Nevada is scheduled to report earnings on Wednesday. Elsewhere, Strathcona Resources said on Sunday it would acquire Greenfire Resources in a deal valued at about C$2.7 billion to C$2.9 billion, including debt, expanding its presence in Alberta’s oil sands. Power of Canada is also due to report Q3 results on Wednesday.

The S&P/TSX Composite Index rose 0.5% to close at 36,789 on Friday, recovering from earlier losses with support from mining shares. Democrats regained control of both chambers of Congress in the US, raising hopes of easing trade tensions, as a Democratic majority could constrain some of President Trump’s trade policy decisions. Meanwhile, Canada’s trade surplus widened to C$5.35 billion in September, as higher energy and gold exports to the US appeared to offset tariff impacts. Agnico Eagle added 2% and Franco-Nevada rose 2.2%, while WPM gained 3.2% after reporting record nine-month results on Thursday, with Q3 revenue soaring 62%. Broader sectors were mixed as investors assessed weaker-than-expected jobs data. Canadian employment fell by 4,700 in October, improving from September’s 68,300 decline but missing forecasts of a 13,600 increase. On the week, the index edged 0.1% lower.

The S&P/TSX Composite Index hovered near 35,500 in a volatile session on Friday after weaker-than-expected jobs data. Canadian employment fell by 4,700 in October, improving from September’s 68,300 decline but missing forecasts of a 13,600 increase. Private-sector employment dropped by 53,000 (-0.4%), its first decline since February. The unemployment rate edged up to 6.7%, a six-month high. Losses were broad-based: major banks fell, with RBC down nearly 1% and BMO about 0.5%; retailers also declined, with ATD losing over 1%; and Enbridge shed 2%. On Thursday, the index suffered its steepest daily decline in five months, dragged down by sharp technology losses after a Wall Street rout. The sector rebounded on Friday, tracking US gains: Shopify rose over 2.5% and Celestica nearly 4% after slumping 12.7% in the prior session. Energy stocks gained despite slightly lower oil prices, while miners were mostly down amid lower gold prices.