TSX Recovers From Post-Brexit Losses With The Canadian Dollar Rising

The Toronto Stock Exchange recovered from its week-long slump to rise by almost 1.4% on Monday, effectively recovering the losses it incurred after Britain voted to leave the EU last month.

The S&P/TSX composite index rose by 194.33 at 14258.87 following its closure on Friday for Canada Day.

This gain meant that the index has recuperated all that it lost after closing on June 23 at 14131.38. Over the course of the following two trading days, the index lost more than 441 points.

Twelve of the thirteen subgroups that closed higher on Monday were led by metals and mining, which at 621.54 points, up by 37.18 points

Only consumer staples suffered a decline, losing 0.08 points to 501.72.

Kash Pashootan, senior vice-president and portfolio manager at First Avenue Advisory in Ottawa, a Raymond James company said the TSX is on “a continued push higher as markets are becoming more comfortable with the Brexit announcement.”

American stock markets also followed suite as they experienced a similar surge at the end of last week, he added.

The stock markets were closed in the United States for Independence Day on Monday. But they were up by 3% last week, which almost made up for the losses incurred courtesy of the Brexit.

He added that the market followed a similar pattern to past events like the Sep 11 attacks.

“We view these as buying opportunities if you have cash on the sidelines,” remarked Pashootan. However, he was quick to add that the storm is not yet over as far as Brexit is concerned.

“It’s simply too early for the markets to start to price in a doomsday scenario.”

He said that there will be more clarity and context regarding the details and ramifications of the Britain’s exit from the EU in two or three years’ time.

The Canadian dollar was at 77.78 cents US, up 0.36 of a cent from Thursday.

The August crude contract was at $48.76 US per barrel at around 4 p.m. E.T., which represents a decline of 23% from Friday’s closing.

August natural gas was down 7.9 cents US at $2.908 US per mmBTU.

The August gold contract was at $1353.50 US an ounce which represents a rise of $14.50 US and the September copper contracts were nearly unchanged at $2.22 a pound.


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