Update: TSX Little Changed, Adds 11 Points Friday, As Trade Deficit Narrows Substantially

Canada's main stock market was stuck in neutral on Friday despite a surprise narrowing of the international trade deficit amid record exports. The S&P/TSX Composite Index gained 11 points or 0.1% to close at 16,420. The TSX gained 32 points on Friday and the index was little changed for the week, gaining 0.2%. South of the border, the Dow Jones gained more than 130 points Friday while the Nasdaq was little changed.

Materials led advancers on the TSX, rising 0.5% as gold prices posted a modest increase. However, those gains were mostly offset by losses in energy (-0.4%, as oil prices declined) and financials (-0.15%).

In stock news, heavily traded Bombardier (BBD-B.TO) gained 4% while Aurora Cannabis (ACB.TO) lost 3%. Telus (T.TO) fell nearly 1% even as the telecom company matched analyst expectations on its most recent earnings report. Parkland Fuel (PKI.TO) was up 7% while Aimia (AIM.TO) rose 8% after rejecting a bid from Air Canada for its Aeroplan holdings. Aimia also said it has a new deal with Toronto-based Porter Airlines to become a preferred Canadian airline for the Aeroplan program as of July 2020, when the current arrangement with Air Canada ends.

In economic news, Canada's trade deficit narrowed to -$0.6 billion in June from a revised -$2.7 billion shortfall (was -$2.8 billion) in May. The narrowing in the deficit was much more pronounced than expected (median -$2.3 billion) and left the smallest shortfall since the -$0.5 billion decline in January 2017. Export values surged 4.1% in June amid broad-based gains, although a 7.1% rise in energy product values and a 18.9% run-up in aircraft and other transportation equipment exports led the way. Exports values excluding energy products climbed 3.4%. Also notable, a 22.9% increase in exports of metal ores and non-metallic minerals and a 3.7% rise in motor vehicle and parts. Imports slipped 0.2%.

The Canadian dollar climbed to the 77 cent US mark, adding a fifth of a cent to 77.00 US.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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