The Art Deco facade of the original Toronto Stock Exchange building is seen on Bay Street in Toronto, Ontario, Canada January 23, 2019. REUTERS/Chris Helgren Acquire Licensing Rights
Aug 31 (Reuters) – Canada’s main index extended gains on Thursday as a jump in Shopify shares lifted the broader technology sector, while pot firms gained after the United States’ move to ease curbs on marijuana.
At 10:25 a.m. ET (1425 GMT), the Toronto Stock Exchange’s S&P/TSX composite index (.GSPTSE) was up 51.69 points, or 0.25%, at 20,382.01. The index rose for the fifth straight session, but was on track for a monthly decline of 1.2%.
Technology stocks (.SPTTTK) rose 2.4%, led by an 8.0% gain in Shopify (SHOP.TO) after the company said Amazon.com (AMZN.O) would release an app in Shopify’s app ecosystem that would give U.S.-based merchants access to Amazon’s “Buy with Prime” option.
Shares of cannabis firms Cronos Group (CRON.TO), Tilray Brands , OrganiGram Holdings (OGI.TO), Aurora Cannabis (ACB.TO), Canopy Growth (WEED.TO) jumped between 3% and 11%.
The healthcare index (.GSPTTHC), housing the pot stocks, rose nearly 3% to lead sectoral gains.
Canadian Imperial Bank of Commerce (CM.TO) fell 3% after it missed analysts’ estimates for quarterly profit.
Five of the big six Canadian banks missed quarterly profit estimates on higher loan loss provisions amid the Bank of Canada’s aggressive interest rate hikes since last year.
“Old days of secular interest rate declines, robust investment banking fees, growth in consumer lending growth without having credit losses is all done in this (economic) environment. This is a new paradigm for the bank stocks,” said Matt Manara, partner and portfolio manager, Aventine Investment Management.
“One of the other interesting stats is bank assets to Canada’s GDP are close to 400% when in the U.S. they’re less than half of that. The banks are highly levered and very vulnerable going into a recession.”
Separately, data showed U.S. personal consumption expenditures price index, the Federal Reserve’s preferred inflation gauge, climbed 3.3% in July, on an annual basis, in line with expectations.
Reporting by Siddarth S in Bengaluru; Editing by Shounak Dasgupta and Shilpi Majumdar
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