{"id":194559,"date":"2018-12-18T22:05:27","date_gmt":"2018-12-19T03:05:27","guid":{"rendered":"https:\/\/canadianinquirer.net\/v1\/?p=194559"},"modified":"2018-12-18T22:05:27","modified_gmt":"2018-12-19T03:05:27","slug":"tsx-rebounds-despite-crude-prices-slipping-again-to-15-month-low","status":"publish","type":"post","link":"https:\/\/canadianinquirer.net\/v1\/2018\/12\/18\/tsx-rebounds-despite-crude-prices-slipping-again-to-15-month-low\/","title":{"rendered":"TSX rebounds despite crude prices slipping again to 15 month low"},"content":{"rendered":"
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The S&P\/TSX composite index closed up 54.24 points at 14,416.89 after peaking at 14,502.64 on 383 million shares traded. That snapped a three day losing streak and seven days of losses in nine trading sessions. (Pixabay photo)<\/figcaption><\/figure>\n

TORONTO \u2014\u00a0Canada’s main stock index rebounded Tuesday from three days of losses even though oil prices fell deeply to a 15-month low on concerns about a glut of energy.<\/p>\n

The S&P\/TSX composite index closed up 54.24 points at 14,416.89 after peaking at 14,502.64 on 383 million shares traded. That snapped a three day losing streak and seven days of losses in nine trading sessions.<\/p>\n

The influential materials sector gained two per cent as gold prices rose on a dip in the U.S. dollar.<\/p>\n

The February gold contract was up US$1.80 at US$1,253.60 an ounce while the Canadian dollar traded at an average of 74.33 cents US compared with an average of 74.63 cents US on Monday.<\/p>\n

However, the energy sector lost more than one per cent as the February crude contract fell about seven per cent or US$3.60 at US$46.60 per barrel.<\/p>\n

With production cuts from OPEC and Russian not taking hold until the new year, and the market anticipating softer demand growth, there’s a growing worry about a buildup of inventories that are weighing down prices, at least in the short-term, said Craig Jerusalim, portfolio manager at CIBC Asset Management.<\/p>\n

Longer-term, U.S. shale producers can dial back production if companies aren’t profitable at around US$50 a barrel, he said.<\/p>\n

\u201cWe will eventually see a supply response and as companies stop investing in production and production growth, that will result in a balancing of the supply, demand fundamentals and we’ll see oil prices rise as a result of that,\u201d he said in an interview.<\/p>\n

\u201cLayer on any OPEC plus Russian production cuts and that’s ultimately what’s going to rebalance the market in the medium term.\u201d<\/p>\n

While crude prices can still dip further in the short-term, they should hover around the mid-$50s, said Jerusalim.<\/p>\n

In New York, the Dow Jones industrial average gained 82.66 points at 23,675.64. The S&P 500 index eked out a 0.22 of a point increase at 2,546.16, while the Nasdaq composite was up 30.18 points at 6,783.91.<\/p>\n

Markets turned slightly positive at the end of the day after flirting with losses ahead of the Federal Reserve’s decision Wednesday about interest rate increases.<\/p>\n

U.S. President Donald Trump tweeted that it was \u201cincredible\u201d for the Fed to even be considering another rate hike, but the market is pricing in about a two-thirds chance of an increase, said Jerusalim.<\/p>\n

\u201cReally I think what’s happened throughout the day is investors took risk off of the table in anticipation of this binary event.\u201d<\/p>\n

He said data indicates there’s very little indication of a recession in the U.S. or\u00a0Canada\u00a0next year. That’s what Bank of\u00a0Canada\u00a0Stephen Poloz indicated during year-end interviews with various media.<\/p>\n

\u201cThe Canadian economy has had some road bumps with energy prices and trade concerns so I think it’s a positive the comments about not seeing a recession in 2019,\u201d Jerusalim added.<\/p>\n

\u201cI think it’s encouraging and makes a lot of sense.\u201d<\/p>\n

However, markets have lost ground over the past few months, especially in December, as part of a valuation correction.<\/p>\n

The January natural gas contract was up 31 cents at US$3.84 per mmBTU and the March copper contract was down nine cents at US$2.66 a pound.<\/p>\n","protected":false},"excerpt":{"rendered":"

TORONTO \u2014\u00a0Canada’s main stock index rebounded Tuesday from three days of losses even though oil prices fell deeply to a …<\/p>\n","protected":false},"author":44,"featured_media":154670,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[19],"tags":[],"class_list":["post-194559","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","mauthors-ross-marowits","mauthors-the-canadian-press"],"_links":{"self":[{"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/posts\/194559","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/users\/44"}],"replies":[{"embeddable":true,"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/comments?post=194559"}],"version-history":[{"count":0,"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/posts\/194559\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/media\/154670"}],"wp:attachment":[{"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/media?parent=194559"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/categories?post=194559"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/tags?post=194559"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}