North American stock markets exhibited little movement Wednesday, with trading volumes tapering off ahead of the Christmas holiday long weekend.
In Toronto, the S&P/TSX composite index climbed 12.93 points at 15,305.89, inching higher with help from a rise in industrials, utilities and real estate stocks.
The index, which is weighted heavily in commodities, has been on a tear this year, gaining more than 17% year to date.
Investors had held a bleak picture for the S&P/TSX at the start of the year, when it opened at 12,927.15 amid low oil prices and a poor outlook for the energy industry.
But as the months progressed, hope began to build over the prospects of a supply cut from OPEC members.
That deal finally materialized on Nov. 30 when OPEC agreed to decrease production by 1.2 million barrels a day starting in January. Earlier this month, Russia and 10 other nations also agreed to scale back production by 558,000 barrels a day for six months during the same period.
Those deals have helped inject optimism back into the market, which is poised to finish 2016 on a positive note.
Volumes have been slowing down for the past few days as traders prepare for stock markets in Toronto and New York to be closed for the holidays on Dec. 26 and Dec. 27. Markets will reopen on Dec. 28.
“We’re just coasting until the end of the year,” said Laura Lau, a senior portfolio manager at Brompton Group.
Lau noted that it wasn’t only energy companies that were hit hard at the start of this year, but financials including banks, which rely on oil firms for business, were also hurt.
That sentiment has definitely changed as Canadian banks anticipate being buoyed by higher interest rates from the U.S. and signs that president-elect Donald Trump will move towards loosening regulations on the financial industry.
“You can see there is more optimism,” she said.
“Banks have enough capital and are in good shape. They don’t have the pressure of lower oil prices and with interest rates going up, they’ll make more money on loans.”
In the U.S., major benchmarks were down, with the Dow Jones industrial average falling 32.66 points to 19,941.96, still shy of the 20,000 level.
One of the biggest weights on the Dow was bank Goldman Sachs, which fell US$1.65, or 0.68%, to US$241.44. Goldman is trading near an all-time high, and its 32% gain since the Nov. 8 U.S. presidential election is far better than any other Dow stock.
The S&P 500 slipped 5.58 points to 2,265.18, while the Nasdaq composite dropped 12.51 points to 5,471.43.
The Canadian dollar was at US74.59¢, down US0.22¢.
In commodities, the February crude contract slipped US81¢ to US$52.49 per barrel and January natural gas was up US28¢ at US$3.54 per mmBTU.
The February gold contract fell US40¢ to US$1,133.20 an ounce and March copper contracts dipped US1¢ to US$2.50 a pound.