Energy sector helps lift stocks in Toronto, U.S. stock markets surge higher

TORONTO — Canada's main stock index closed higher in a broad rally led by energy stocks, while in the U.S. tech stocks helped lead markets to sharper gains.

Monday's gains were a bit of a recovery after the TSX registered its first loss of the year last week, said Craig Fehr, Canadian markets strategist for Edward Jones.

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"I think we're just getting something of a rebound."

The S&P/TSX composite index closed up 110.03 points at 16,106.24 after reaching as high as 16,131.94 on 248.5 million shares traded.

The influential energy index climbed 1.17 per cent as the crude price ended up 72 cents at US$56.79 per barrel after OPEC signalled more production cuts.

In New York, the Dow Jones industrial average closed up 200.64 points at 25,650.88. The S&P 500 index was up 40.23 points at 2,783.30, while the Nasdaq composite was up 149.92 points at 7,558.06.

The gains came after about a half a per cent loss for the TSX last week, while US stocks lost closer to two per cent last week to create bigger gains Monday, said Fehr.

"The bigger jump in US equities is probably a function of the steeper declines last week."

The U.S. market was also boosted by strong retail sales numbers out Monday to help ease concerns from recent payroll reports and sales data.

This report gave a counter to that weakness, suggesting the consumer is still on a pretty solid footing, said Fehr.

U.S. stocks were also boosted by gains in technology, while the Dow was weighed down by a five per cent drop in Boeing's stock after a second of its 737 Max 8 aircraft crashed in recent months.

Friday's healthy jobs numbers from Canada likely also helped prop up the Canadian market as a welcome counter to some of the headwinds in the economy.

"To me, the rather healthy labour market, in terms of job growth in recent months, is probably the brightest spot for the Canadian economy in terms of a pillar that will continue to support a positive expansion," said Fehr.

Canada does, however, face significantly more challenges that the U.S. in the coming year, he said.

"Trade is weighing a little bit, we're seeing the housing market roll over both in terms of construction activity and in prices, and we know we have high consumer debt. Those three are kind of the big challenges for the Canadian economy moving ahead."

The Canadian dollar averaged 74.55 cents US, compared with an average of 74.50 cents US on Friday.

The April gold contract closed down US$8.20 at US$1,291.10 an ounce and the May copper contract was up a penny at US$2.90 a pound. The April natural gas contract was down nine cents at US$2.77 per mmBTU.

Companies in this story: (TSX:GSPTSE, TSX:CADUSD=X)

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