Market insights
Weekly Market Commentary - August 27, 2010
Global stock markets finish week on a positive note
Stock markets around the world rallied on Friday on revised GDP data and comments from U.S. Federal Reserve Chair Ben Bernanke.
On Friday, the U.S. Commerce Department cut its Gross Domestic Product (GDP) estimates for the second quarter. Second quarter GDP was revised down to 1.6% from 2.4% on an annualized basis, but the reduction in growth was not as severe as originally forecast and markets responded positively.
The GDP report also showed that consumer spending was up in the second quarter on higher electricity and natural gas prices, and that purchases increased at 1.9% from January to March of 2010.
In an anticipated speech, U.S. Federal Reserve Chair Ben Bernanke said the Federal Reserve, in light of recent mixed economic reports, would do all it can to support the recovery, including the large-scale purchase of securities if the economy were to deteriorate significantly. In his comments at the annual central bank conference, Bernanke acknowledged the recovery is uneven, but that preconditions for growth in 2011 are in place.
Weekly unemployment claims fell sharply for the first time in a month, and at 473,000 handily beat expectations. Corporate earnings were mixed with CIBC and National Bank beating consensus forecasts, and Bank of Montreal and Royal Bank of Canada missing expectations. Toronto-Dominion Bank and Bank of Nova Scotia report next week.
European markets advanced on Friday on strong earnings results from French bank Credit Agricole, hotelier Accor, and cosmetics company L’Oreal. Australian-based BHP Billiton doubled profits on a full-year basis.
Also this week in the markets:
- Existing home sales down 27.2% in July
- New home sales off by 12.4% in July
- Median home price up 0.7% y/y
- Mortgage applications were up 4.9% last week
- Durable goods orders increased 0.3% in July
- Canadian retail sales up 0.1% in June
What's ahead next week:
Canada:
- Industrial production
- Real GDP
- Auto sales
U.S.:
- Consumer confidence
- ISM index
- Construction spending
- National Employment report
This week's market closing values
Level |
Change |
1-week |
YTD |
1-year |
5-year |
|
EQUITY INDICES |
CAD |
CAD |
CAD |
CAD |
||
|---|---|---|---|---|---|---|
| S&P/TSX | 11,879.72 | + 157.65 | + 1.34% | + 1.14% | + 8.65% | + 2.53% |
| S&P 500 | 1,064.59 | - 7.10 | + 0.05% | - 3.53% | - 0.18% | - 4.87% |
| DJIA | 10,150.65 | - 62.97 | + 0.09% | - 1.64% | + 2.42% | - 2.94% |
| FTSE 100 | 5,201.56 | + 6.28 | + 0.73% | - 6.69% | - 1.13% | - 5.48% |
| CAC 40 | 3,507.44 | - 18.68 | + 0.49% | - 19.92% | - 16.98% | - 5.92% |
| DAX | 5,951.17 | - 53.99 | + 0.12% | - 11.05% | - 6.05% | + 2.57% |
| Nikkei | 8,991.06 | - 188.32 | - 0.88% | - 7.48% | - 8.89% | - 3.86% |
| Hang Seng | 20,597.35 | - 384.47 | - 1.17% | - 5.15% | - 1.98% | + 3.91% |
CURRENCY RETURNS |
CAD |
Change |
||||
|---|---|---|---|---|---|---|
| US$ | 1.0527 | + 0.0052 | + 0.50% | - 0.05% | - 3.22% | - 2.58% |
| Euro | 1.3406 | + 0.0091 | + 0.68% | - 11.13% | - 14.05% | - 1.88% |
| Yen | 1.2348 | + 0.0112 | + 0.92% | + 9.09% | + 6.17% | + 2.55% |
CANADIAN TREASURIES |
Yield |
Change |
COMMODITIES |
USD |
Change |
|
|---|---|---|---|---|---|---|
| 3-month | 0.66 | + 0.04 | Oil | $75.45 | + $1.99 | |
| 5-year | 2.15 | - 0.04 | Gold | $1,237.75 | + $9.95 | |
| 10-year | 2.87 | - 0.05 | Natural Gas | $3.75 | - $0.44 |
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