TORONTO — The Toronto stock exchange posted a significant rally on Wednesday as North American equity markets posted strong results on the final day of what has been a dismal quarter for investors.
The Toronto Stock Exchange’s S&P/TSX index ended the day up 270 points at 13,306.96, yet the index is still 1,200 points or 8.5 per cent lower than where it stood at the end of June.
In New York, the Dow Jones industrial average rose 235.57 points to 16,284.70, while the broader S&P 500 advanced 35.94 points to 1,920.03 and the Nasdaq gained 102.84 points to 4,620.16.
Despite the widespread rise, the U.S. indexes were also closing out a miserable three months, with the Dow down more than eight per cent and the S&P500 and Nasdaq off well over seven per cent apiece.
The big gains in North America followed similar rebounds in Europe and Asia, although many of those indexes were also heading for their worst quarterly performances in years.
Britain’s FTSE 100 rose 2.2 per cent, France’s CAC 40 jumped 2.6 per cent and Germany’s DAX gained 2.2 per cent. The worst performing of those indexes, the DAX, is down 11.8 per cent for the quarter.
Japan’s Nikkei 225 surged 2.7 per cent, Hong Kong’s Hang Seng index added 1.4 per cent, and China’s Shanghai Composite Index was 0.5 per cent higher. The Shanghai index has lost 29 per cent in the past three months amid huge volatility and government action to prop up share prices.
Tim Courtney, chief investment officer of Exencial Wealth Advisors, said rallies like the one today come as no surprise.
After “so many negative days, you’re going to get a bounceback,” he told The Associated Press.
In Toronto, the capped health-care sector showed the biggest gain on the day as investors returned to boost the share price of Valeant Pharmaceutical International (TSX:VRX) after a heavy sell-off earlier this week.
Valeant stock had come under pressure after the company landed in the crosshairs of congressional Democrats over significant price increases for two heart medications in the U.S.
Valeant stock, which accounts for most of the weighting in the sector, enjoyed a significant rebound today, up $26.14, or 12.33 per cent, to $238.20.
Today’s recovery came after analysts suggested that Monday’s selloff, which saw shares fall 16.5 per cent, was a buying opportunity for investors.
On the commodity markets, the December gold contract fell $11.60 to US$1,115.20 an ounce, while the November crude oil closed down 14 cents to US$45.09 a barrel. The November natural gas contract fell 6.2 cents to US$2.524 per thousand cubic feet.
The loonie ended the day up 0.4 of a U.S. cent to 74.93 cents US, slightly above the 11-year low it hit earlier this week.
Meanwhile, investors will be watching for U.S. government jobs data out Friday that may give a hint of when the Federal Reserves may begin to raise interest rates that have been at historic lows since the Great Recession. The Fed has cited the jobs market as a major factor in its deliberations.
On Wednesday, payroll processor ADP reported that U.S. employers added 200,000 jobs in September, up from 180,000 in August.
