Business

North American markets end best year since 2013 thanks to big gains in tech stocks

The economic forecast for 2020 looks good as stock markets closed out their best year since 2013, led by huge gains in technology stocks.

The Toronto Stock Exchange's S&P/TSX composite index was up 19% on the year

Stocks slipped globally in quiet New Year's Eve trading Tuesday with many markets closed. However, the benchmark S&P 500 index soared 28.9 per cent for the year while The Toronto Stock Exchange's S&P/TSX composite index was up 19 per cent on the year.  (Mark Lennihan/The Associated Press)

Stocks are closing out their best year since 2013, led by huge gains in technology stocks.

The benchmark S&P 500 index soared 28.9 per cent for the year.

Major indexes ended slightly higher Tuesday after spending most of the day wavering between small gains and losses. Technology and health-care stocks led the gainers. The S&P 500 rose nine points, or 0.3 per cent, to 3,230.

The Dow Jones Industrial Average added 76 points, or 0.26 per cent, to 28,538. The Nasdaq rose 26 points, or 0.3 per cent, to 8,972. Bond prices fell, sending yields higher. The yield on the 10-year Treasury note rose to 1.92 per cent.

The Toronto Stock Exchange's S&P/TSX composite index was down 35.13 points at 17,063 but was up 19 per cent on the year. 

The Canadian dollar traded at 77.01 cents US, up from Monday's average of 76.58 cents US. This compares to the same time last year when it closed at 77.37 cents US. 

"The Canadian dollar strength was due to many factors," said Rahim Madhavji, president and currency strategist at Knightsbridge Foreign Exchange. "Chief among them was the Bank of Canada's shift from a dovish to neutral monetary policy stance."

Oil prices have made major gains on the year, with the West Texas Intermediate contract finishing above $61 US a barrel in Tuesday trading, a 34 per cent increase on the year. Canadian contracts have not fared as well, with the discount on the price of Western Canadian Select widening to $22.50 US. 

Still, strengthening energy prices helped buoy Canadian markets, as well as GDP growth that appeared to strengthen until a disappointing showing in October. 

In a recent report, analysts at BMO Capital Markets said they expect North American economies "to grow close to long-run potential in 2020." However, to ensure that happens, the U.S. and China will have to continue to wind down their tariff battle. 

"While the growth risks are starting to tilt to the upside for the first time in several years, much will depend on further progress to end the trade war," the report said.

With files from CBC News

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