Stock markets rebound Friday after Thursday's steep fall
Canadian dollar continues slide below 90 cents US
Toronto and New York markets rebounded Friday from steep losses the day before, as investors sought bargains amid Thursday’s lower stock prices.
The Canadian dollar continued its fall below 90 cents US, and ended the day down 0.38 of a cent to 89.65 cents US.
A strong U.S. dollar and a revision to U.S. GDP showing second quarter growth was higher than expected weighed down the loonie.
Those better U.S. GDP numbers also buoyed Wall Street. The Dow Jones industrials added 167.35 points to 17,113.15, the Nasdaq gained 45.44 points to 4,512.19 and the S&P 500 index saw an uptick of 16.86 points to 1,982.85.
The Bank of Canada has put forward signals in the past week that it is hoping for a lower Canadian dollar, with speeches from governor Stephen Poloz and deputy Carolyn Wilkins reinforcing the message.
The bank is concerned about the slow growth of exports from Canada and a lower dollar could help exporters win more markets.
Despite the slow recovery of demand from the U.S., there is no clear upward trend in Canadian exporting.
"The Bank of Canada wants a lower loonie," he said. "It'll drive exports. We're an export-led economy and that's what we need," said Kevin Headland, director of the portfolio advisory group for Manulife Asset Management. Canadian markets remain vulnerable to low commodity prices, including gold and oil prices.
The Toronto market plunged more than 200 points Thursday, capping a fifth day of declines and taking the index below 15,000 for the first time since May. The U.S. indexes did even worse, with the Dow down nearly 250 points.
But there clear reasons for optimism in markets today, with Apple regaining its shine after apologizing for a technical glitch.
Nike jumped 11 per cent after its earnings rose sharply, and Janus Capital Group soared 32 per cent after announcing it had hired star bond fund manager Bill Gross.
With files from Canadian Press