By Mike Keerma
S&P 500 Composite Index and the
Nasdaq Composite Index edged up this week as a positive U.S. jobs report for June buoyed investor
sentiment helped along by a growing consensus that the Fed will hold off on
another rate hike until December. Technology stocks rebounded after a
losing streak and helped the big indices climb back from losses earlier in
S&P/TSX Composite Index, however, slipped -1% on the week, despite similarly strong Canadian job
creation in June, as traders continued to price in a 25-basis-point rate
hike by the Bank of Canada next week. June’s strong job numbers helped
Canadian dollar to US$0.776 by Friday’s close.
Sliding energy stocks also weighed on TSX peformance as the price of
crude oil fell -4.0% on the week, against a backdrop of growing supply and the global
market’s general indifference to and skepticism of the much-ballyhooed
production cuts by the Organization for the Petroleum Exporting Countries.
And despite rising geopolitical tensions in Asia as a consequence of North
Korea’s intercontinental ballistic missile test,
gold fell -2.4% on the week.
The U.S. Labor Department reported that the U.S. economy added 222,000 new
non-farm jobs in June, the largest monthly job gain so far this year. The
unemployment rate ticked up slightly to 4.4% for the month, from 4.3% in
May. Average earnings, however, rose only 0.2% on the month (a 2.5% annual
rate). With low unemployment and low inflation, and a growing economy,
there seems little need for the Fed to increase its federal funds rate,
with analysts now expecting the Fed to push back its next rate hike to
December at the earliest.
Statistics Canada reported that the Canadian economy added 45,300 new jobs
in June, with part-time jobs dominating in the month, as is common in the
summer months. The unemployment rate ticked back to 6.5% in June, down from
6.6% in May. Average hourly earnings, however, grew only 1.1% in the month,
according to StatsCan’s Labour Force Survey, a datapoint that some
economists believe should be stronger consider Canada’s GDP growth, jobs
creation, and inflation rate. Still, some observers believe the most recent
data are enough to spur the Bank of Canada to raise its target overnight
lending rate by 25 basis points next week from .
* First Asset TrendLeaders ETF debuts on TSX.
First Asset Investment Management Inc. announced that its
First Asset U.S. TrendLeaders Index ETF (TSX: SID) debuted on the Toronto Stock Exchange on Friday. The CIBC U.S. TrendLeaders
Index is a portfolio of U.S. stocks, chosen by a proprietary CIBC World
Markets model, which selects and ranks securities based on the duration and
longevity of certain underlying trend-strengths and incorporates an
objective quantitative filter for technical factors.
* BlackRock announces fund terminations.
BlackRock Asset Management Canada announced that it will terminate a number of its exchange-traded funds. In
a release, BlackRocks said the decision to shutter the funds is “based on
an ongoing process to review [BlackRock’s] product lineup and ensure it
meets the evolving needs of its clients. The funds will terminate on or
about Sept. 27.
iShares Conservative Core Portfolio Builder Fund (TSX: XCR)
iShares Growth Core Portfolio Builder Fund (TSX: XGR)
iShares Global Completion Portfolio Builder Fund (TSX: XGC)
iShares Alternatives Completion Portfolio Builder Fund (TSX: XAL)
iShares MSCI Brazil Index ETF (TSX: XBZ)
iShares BRIC Index ETF (TSX: CBQ
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