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The U.S. labor market added 850,000 jobs in June, helping fuel the main U.S. stock gauges to healthy gains for the week, capping a string of record highs throughout June, for strong second-quarter advances as the U.S. economy re-opened fully after a year of Covid-19 restrictions. Despite a surge in the rate of inflation, which the U.S. Federal Reserve has insisted is “transitory” and thus giving no impetus for any immediate monetary tightening, investor sentiment continues to be positive, shoring up stock indexes as each new high is reached.
The S&P 500 Composite Index posted a 1.7% advance for the week, as the month of June closed with an overall 2.2% gain, for an increase of 8.2% in the second quarter. The Nasdaq Composite Index, with its heavy weighting to technology and growth issues, gained 1.9% on the week, with a strong 5.5% advance in June, and a 9.5% gain in the second quarter.
Toronto’s S&P/TSX Composite Index felt the drag of financial, energy, and healthcare issues, closing a tick below breakeven on the week. Energy stocks, a key component of the index, also experienced a choppy week as the Organization of the Petroleum Exporting Countries and Russia (OPEC+) maintained output curbs on crude oil production that were put in place last year to stabilize prices during the global economic slump. The cartel kicked the can down the road on any decision to raise production quotas, reportedly because of a dispute between Saudi Arabia and the United Arab Emirates. Crude oil closed the week with a gain of 1.6%, with an advance of 10.9% in June and 24.2% for the second quarter. Gold prices did not signal any particular concerns, as traders saw little threat from inflation, for now at least. The precious metal gained 0.3% on the week, with a loss of 7.0% in June, and an increase of 3.3% in the second quarter.
* NBI launches four new mutual funds. National Bank Investments Inc. on June 28 debuted four new funds, including a global balanced fund and three sustainable funds.
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