Canada Stock Market Hits All-Time High on 'Commodity Price Surge' Boost

[Asia Economy Reporter Park Byung-hee] The Canadian stock market reached an all-time high on the 17th (local time), supported by rising raw material prices, Bloomberg reported on the same day.

The S&P TSX Composite Index of the Toronto Stock Exchange closed at 21,771.22, up 1.4% from the previous trading day. It surpassed the previous closing record of 21,768.53 set on November 12 last year.

Mining and energy-related stocks led the index's rise. Oil, gas, and mining companies account for nearly one-third of the market capitalization in the Canadian stock market.

With raw material prices, including crude oil, rising significantly this year, the Canadian stock market is recording better returns compared to other markets.

While the S&P 500 index of the U.S. New York Stock Exchange has fallen more than 7% this year, the S&P TSX index has instead risen by 2.6%.

There is growing expectation that the Canadian stock market could achieve better returns than the New York stock market for the first time in a while this year. Since 2011, the Canadian stock market has outperformed the New York stock market only once, in 2016.

Bank stocks, which account for 33% of the Canadian stock market, have also shown strength this year amid expectations of benefits from interest rate hikes. When the benchmark interest rate rises, the interest rate spread between loans and deposits widens, improving banks' profitability. The Bank of Canada raised the benchmark interest rate by 0.25 percentage points on the 2nd for the first time in over three years, and further hikes are expected.

This content was produced with the assistance of AI translation services.