Toronto stocks higher as energy sector gains ground amid higher oil prices

Toronto stocks higher as energy sector gains ground amid higher oil prices
Stock futures point to a rebound as global markets, crude oil rally
Canadas main stock index rose at open on Monday, as energy shares gained after oil prices bounced back.

The Toronto Stock Exchanges S&P/TSX Composite index was up 56.31 points, or 0.38 per cent, at 15,067.04

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Stock futures jump as oil rebounds

U.S. stocks opened higher on Monday, as optimism of a robust holiday season powered gains in shares of retailers and technology stocks bounced back after a brutal sell-off last week.

The S&P 500 opened higher by 17.41 points, or 0.66 per cent, at 2,649.97. The Nasdaq Composite gained 87.51 points, or 1.26 per cent, to 7,026.50 at the opening bell.

In Asia, Japan’s Nikkei ended the day up 0.76 percent. China’s Shanghai Composite finished the session off by 0.1 percent. Hong Kong’s Hang Seng index closed the day with a gain of 1.7 percent.

The S&P 500 opened higher by 17.41 points, or 0.66 per cent, at 2,649.97. The Nasdaq Composite gained 87.51 points, or 1.26 percent, to 7,026.50 at the opening bell.

U.S. stocks surged Monday on strong Black Friday spending, increases in the price of crude oil and global equity gains. Triple-digit gains on the Dow Jones Industrial Average paced the broader equity market.

Europes markets rallied on Monday on signs that Italy was preparing to rework the spending plans that have fuelled tensions with the European Union.

On Friday, U.S. stocks fell, led by weaker tech company shares, and crude oil prices extended their slump while retailers handled the annual Black Friday shopping spree.

A bounce in oil after its own black Friday, the survival chances of Britains newly sealed Brexit agreement and renewed Russia and Ukraine tensions had all kept Europes traders busy, but it was Italy that stole the show.

In Europe, London’s FTSE was up 0.7 percent, Germany’s DAX  gained 1.1 percent and France’s CAC added 0.6 percent.

Deputy Prime Minister Matteo Salvini had hinted over the weekend at the possibility of tweaking the countrys budget deficit goal, saying no one is stuck to the 2.4-per-cent target and there was talk on Monday of closer to 2 per cent.

B. Riley Financial Chief Market Strategist Art Hogan on the impact of U.S. trade tensions with China and the Federal Reserve on the markets.

Italys banks index duly leapt 5 per cent towards its strongest day since June and an equally strong rally in bond markets sent Italian borrowing costs to their lowest since September.

In addition, hopes for a detente in the trade dispute between the U.S. and China at the G20 summit in Argentina lifted investor sentiment.

It will help the banks if the BTP-Bund spread goes lower which it has been this morning, Pierre Bose, head of European strategy at Credit Suisse Wealth Management, said.

You potentially move from a negative spiral to a more positive spiral where you end up with less pressure on the banks, more ability to lend and that will underpin growth in a better fashion.

The euro also climbed, rising 0.25 per cent to $1.1370 and as much as 0.7 per cent at 128.73 yen, though it lost a bit of traction after Germanys monthly Ifo survey showed a larger-than-expected drop in business morale.

The final trading week of the month will feature reports on home prices, GDP and minutes from the last Fed meeting.

The (Ifo) indexs fall is somewhat alarming, Uwe Burkert of LBBW wrote in a note. It was generally expected that the economic weakness of the third quarter would be corrected with a firmly positive growth figure in the fourth quarter.

Tech stocks led the broader market's decline, with Facebook and Apple falling more than 2 percent.

There was also a 0.3-per-cent rise for the pound against the dollar after Britain and European Union reached an agreement over Brexit plans on Sunday.

Crude oil prices popped more than 3 percent and Asian as well as European bourses were booking gains.

It was flat against the euro, though, and analysts remain cautious that the Brexit deal faces stiff opposition within the British parliament, which will is expected to vote on the agreement in around two weeks time.

The failure of the pound to rally on recent positive developments suggest the market is pricing in that the deal wont pass the first time in parliament, said Lee Hardman, a currency analyst at MUFG.

Wall Street stocks firmed up after another negative session on Friday had seen the S&P 500 record its lowest close in six months, more than 10 per cent down from Septembers peaks, and pushed it back in correction territory.

Signs that shoppers had succumbed to deep discounts offered on Black Friday and Cyber Monday saw Amazon shares jump 2.4 per cent and eBay gain 0.6 per cent in early trading.

Heavy oil price losses that sent Brent crude plunging below $58 per barrel had dragged energy stocks lower on Friday. Brent, hit by growing signs of crude oversupply on world markets as demand ebbs, clawed back lost ground on Monday but was struggling to get much above $60.

Both U.S. WTI and Brent futures are down more than 20 per cent this month, and unless they recover further this week the losses would mark their biggest fall since October 2008.

Brent crude futures last stood at $60.15 per barrel, up 2.3 per cent in London. U.S. crude futures last fetched $51.23 per barrel, up 1.6 per cent on the day and off Fridays low of $50.15.

It is difficult to say whether $60 is the new normal, as there doesnt seem to be a normal at the moment, Cantor Fitzgerald oil and gas analyst Jack Allardyce said.

Overnight in Asia, MSCIs broadest index of the regions shares excluding Japan edged up 0.6 per cent, led by gains in Hong Kong and Taiwan, while Japans Nikkei advanced 0.8 per cent.

In China, the Shanghai composite index eased 0.1 per cent, though, and Bitcoin extended its recent wrechid run, dropping more than 5 per cent from the days highs as selling in cryptocurrencies returned.

Bitcoin was last trading at $3,880 — holding above the 2018 lows it hit last week but it has lost around three quarters of its value this year.

Russian and Ukraine bonds also saw some notable selling after Russia seize three Ukrainian naval ships off the coast of Crimea that Russian authorities said had illegally entered its waters.

With relations still raw after the 2014 annexation of Crimea, the incident risks pushing the two countries towards a wider conflict and is likely to renew Western calls for more sanctions on Moscow.

Gold, meanwhile, rose as fears of a slowdown in global economic growth and uncertainty surrounding the U.S. interest rate trajectory and U.S. China trade tensions bolstered the metals appeal ahead of a G20 meeting at the end of the week.

U.S. stocks rallied Monday as oil prices and global equities gained ground on a day that is arguably one of the most important for retailers as shoppers go hunting for deals on Cyber Monday.

The Dow Jones Industrial Average DJIA, +1.31% climbed 278 points, or 1.2%, to 24,564, while the S&P 500 index SPX, +1.42% rose 32 points, or 1.2%, to 2,665. The Nasdaq Composite Index COMP, +1.74%  rallied 108 points, or 1.6%, to 7,047.

Last week, the Nasdaq tumbled 4.3%, the Dow ended the week 4.4% lower, while the S&P 500 notched a week-on-week decline of 3.8%, marking the worst Thanksgiving week since 2011 for all three indexes.

Losses for oil prices pushed stocks lower last week, and the reverse was true for Monday. After losing 7.7% in Fridays session alone, U.S. crude futures CLF9, +2.56%  rose nearly 3% to trade above $51 a barrel, while Brent crude LCOF9, +3.35%  jumped more than 3% to above $60.

The retail industry was in focus as investors digested initial data on consumers willingness to spend this holiday season after shoppers began deal-hunting in earnest ahead of the holidays.

In-store traffic fell as much as 9% compared with last years Black Friday, according to closely watched metrics from RetailNext and ShopperTrak. But consumers made up for it by spending more money online, as internet sales rose by 26.4% year-over-year from last Wednesday through Friday, according to an estimate by Adobe Systems Inc. Traders will continue to focus on incoming data on spending on todays Cyber Monday, from retailers and outside analysts.

Signs that Italys coalition government was prepared to cut its budget deficit target — a move that could defuse tensions between Rome and the European Union — helped too soothe jitters. U.K. Prime Minister Theresa May also walked away from an EU meeting with approval for her Brexit deal.

Meanwhile, U.S.-China trade tensions continues to loom over the market ahead of the Group of 20 summit beginning Friday when President Donald Trump and Chinese President Xi Jinping are expected to meet and discuss trade issues.

Today were seeing an oversold market bounce, Larry Benedict, chief executive of the Opportunistic Trader, told MarketWatch.

The market is basically flat this year, and we dont see that changing, before the end of December, he said. The market is long in the tooth, and theres no free money any more, he said, referring to rising interest rates, which have made less risky investments an attractive alternative to equities.

Paul Hickey, co-founder of Bespoke Market Intelligence, cautioned investors to put Mondays early gains in perspective. Last Friday the S&P 500 did close at a new low for the current correction, and even with todays 1% gain at the open, the S&P 500 will only be back to levels it was trading at a half-hour before the close on Wednesday, he said.

Traders are on the lookout for signs that fresh concessions will be made before President Trump and Chinas President Xi Jinping sit down together later this week, said David Lutz, head of ETFs at JonesTrading, in a note to clients, adding that the market hopes for a strong showing this Cyber Monday from online retailers.

Shares of Amazon.com Inc. AMZN, +4.41%  climbed 4.1% amid forecasts that Cyber Monday sales are expected to rise by double digits to $7.8 billion this year, making for the biggest online shopping day in the U.S. ever, according to Adobe Analytics.

Other retailers are also trading higher with GameStop Corp. GME, +6.81% up 6.4%, American Eagle Outfitters Inc. AEO, +5.02% rising 4.8%, Best Buy Co. BBY, +2.09% 1.6% higher and Target Corp. TGT, +1.84% gaining 1.6%.

Overstock.com Inc. OSTK, -15.37% is one online retailer that is not seeing its shares rise after The Wall Street Journal reported that Chief Executive Patrick Byrne expected to wrap up a sale of the companys retail business by February to fund its blockchain-enabled smart contract trading platform. That news caused the stock to soar more than 20% on Friday, but the stock was down 16% amid a broad selloff of cryptocurrencies like bitcoin.

Shares of General Motors Co. GM, +5.73%  advanced 5.3% after the car maker announced cost-cutting measures that include layoffs, a reduced vehicle lineup and the closure of U.S. and overseas plants.

Financial stocks are among the biggest winners with the sector underpinning the Dows advance. Goldman Sachs Group Inc. GS, +2.50% shares rose 2.6% while JPMorgan Chase & Co. JPM, +2.66% stock is up 2.5%.

Asian markets were higher with Japans Nikkei NIK, +0.76% rising 0.7% and Hong Kongs Hang Seng Index HSI, +1.73% closing up 1.7%. Chinese markets were more muted, with the Shanghai SHCOMP, -0.14%  up early but ending down 0.1%.

European markets rose with the Stoxx Europe 600 SXXP, +1.23% and the FTSE 100 UKX, +1.20% in positive territory.

Gold GCZ8, -0.03% settled fractionally lower and the U.S. dollar DXY, +0.09% started the week slightly higher.