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Financials, energy help power S&P/TSX composite higher as optimism lifts markets

TORONTO — Optimism in the wake of positive signs for relief from the pandemic-induced economic slump powered markets higher in both Canada and the United States on Monday.

TORONTO — Optimism in the wake of positive signs for relief from the pandemic-induced economic slump powered markets higher in both Canada and the United States on Monday.

In Toronto, gains in the financial and energy sectors helped power a triple-digit advance at the close for Canada's main stock index.

The S&P/TSX composite index was up 108.79 points at 16,626.64.

In New York, the Dow Jones industrial average was up 378.13 points at 28,308.46.

The S&P 500 index was up 34.12 points at 3,431.28, while the Nasdaq composite was up 67.92 points at 11,379.72.

"Today there's a bit of optimism and you can see this reflected in the fact that global markets really across the board are higher today," said Craig Fehr, investment strategist for Edward Jones.

"I think that's a bit of incremental optimism around the hopes that a coronavirus treatment and/or vaccine might be gaining momentum, stoked a bit by President Trump's comments over the weekend that perhaps his administration could look to fast-track some potential treatments."

The U.S. government on Sunday approved an emergency authorization to allow the use of convalescent plasma to treat patients.

The plasma comes from patients who have recovered from the coronavirus and have antibodies, and it may help people battling the disease, though global health officials say the therapy is still experimental.

Meanwhile, Canadian banks rose in advance of quarterly earnings reports that begin on Tuesday.

The Toronto-Dominion Bank was one of the most active stocks traded, rising $1.81 to $64.01. It reports third-quarter results on Thursday.

The Bank of Montreal was up $1.37 at $76.85 and the Bank of Nova Scotia rose 93 cents to $56.48. Both report on Tuesday.

"I think that's a good reflection not only of the bit of optimism that would reflect itself on global demand but the fact we've seen some encouraging domestic economic data in Canada that suggests the economy is on the path of recovery," said Fehr.

On Monday, the October crude contract was up 28 cents at US$42.62 per barrel and the October natural gas contract rose 4.3 cents at nearly US$2.62 per mmBTU.

Suncor Energy Inc., Canada's largest energy company by market capitalization, rose $1.07 to $21.986. Whitecap Resources Inc. jumped 14 cents to $2.64 and Imperial Oil Ltd. rose $1.09 to $22.52.

"We've seen a very modest lift in oil prices today, nothing really to make particular note of," said Fehr.

"Any time we're seeing crude oil prices up it's obviously a benefit for the downtrodden energy sector which has been a laggard, a sizable laggard in fact, not only this year but for the last several years.

The Canadian dollar was little changed at 75.72 cents US compared with 75.73 cents US on Friday.

Materials lost ground on Monday, with the December gold contract down US$7.80 at US$1,939.20 an ounce.

The September copper contract was up almost a penny at nearly US$2.93 a pound.

By Dan Healing in Calgary

This report by The Canadian Press was first published Aug. 24, 2020.

Companies in this story: (TSX:SU, TSX:TD, TSX:BMO, TSX:BNS, TSX:IMO, TSX:WCP)

The Canadian Press

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