TORONTO – The Toronto stock market ended higher on Thursday as oil prices bounded above the US$60-per-barrel mark.
The S&P/TSX composite index was 130.78 points higher at 15,203.61, driven by the energy sector, while the loonie was down 0.04 of a U.S. cent at 81.95 cents.
Crude oil prices have been climbing since the U.S. Energy Information Administration released the latest inventory figures on Wednesday showing a decline of 2.7 million barrels.
The July contract for crude oil made its biggest single-day rally in a month on Thursday, rising $1.74 to US$60.72 a barrel on the New York Mercantile Exchange.
“Everyone seems to be focused on the short-term inventory numbers, but the bigger picture is total U.S. oil production,” said Himalaya Jain, a portfolio manager at Scotia McLeod.
The inventory data showed U.S. oil production dropped by 112,000 barrels for the week ending May 15, which was significantly more than usual.
“It’s evidence that the big decline in drilling activity over the past six months is finally starting to show,” Jain said.
On the TSX, the energy sector was the biggest gainer of the day, rising 2.2 per cent.
Financials were also ahead, moving up 0.7 per cent, before the start of Canadian bank earnings season next Wednesday. The Bank of Montreal (TSX:BMO) is the first bank scheduled to report.
Gold stocks were lower as June gold fell $4.60 to end at US$1,204.10 an ounce.
Canadian e-commerce software maker Shopify Inc. (TSX:SH) soared out of the gate, with its shares rising 97 per cent on its first day of trading. The Ottawa-based e-commerce company’s IPO at US$17 per share raised US$131 million, more than the company expected.
Shares of the company closed at C$31.25 on the TSX.
In New York, markets traded in a narrow range in the face of mixed economic news in advance of the U.S. Memorial Day holiday weekend.
The Dow Jones industrial average was relatively flat, rising 0.34 of point, to 18,285.74, while the Nasdaq rose 19.05 points to 5,090.79 and the S&P 500 advanced 4.97 points to 2,130.82, above its record high close of 2,129.20 on Monday.
In economic news, the U.S. Labor Department said more Americans sought unemployment aid last week, although the number of applications remained at a historically low level consistent with a healthy job market. Weekly applications increased 10,000 to 274,000, while the four-week average, a less volatile figure, fell to a 15-year low of 266,250.
Meanwhile, the Conference Board said its index of leading indicators rose 0.7 per cent last month in its biggest advance since a one per cent increase last July, a sign the American economy is beginning to accelerate from a sharp winter slowdown.
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Note to readers: This is a corrected story. A previous version incorrectly said oil only rose $1.71.