Thursday, May 26, 2016

Forex – Canadian Dollar (CAD) Soars as TSX Registers Best Performance in 9 Months

Canada's main stock market rallied to its highest mark in over 9 months as of Wednesday, hoisted by robust earnings in the banking and energy sectors.

Toronto's S&P/TSX composite index gained 100.89 pts to end at 14,053.75. The last time it settled above the 14,000 level was in August 19, last year.

The largest gainer on the commodity-heavy index was the mining and metals industry, followed by energy issues, which were triggered by an update that indicated a decline in U.S. oil inventory.

The Energy Information Administration of the U.S. disclosed that crude stocks were down by 4.3 million barrels during the past seven days, which gave market experts some shock, and who were anticipating a tiny decline.

Clues that crude supply is falling helped advance the July crude contract up by 94 cents at US$49.56 per barrel.

According to Manulife Assets director for portfolio managements Stevie Balile, "the market is focused on this trend because it is the most important key points you can have for inventories."

Traders tend to look at crude stockpiles to gauge whether a balance between demand and supply has been affected. In 2014, a barrel of oil rose above US$100 levels, but a worldwide glut in crude inventory have made a dent on prices since then.

The Canadian dollar, which trades closely with crude values, also found strength. The loonie gained 0.72 of a cent to end at 76.79 cents US.

Meanwhile, June gold contract was down $5.40 to US$1,223.80 per ounce and July copper contracts rallied four cents to US$2.10 a pound. July natural gas climbed 4 cents at US$2.18 per mmBTU.

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