Global equity markets moved higher over the week ended July 8 as investors brushed aside recessionary concerns, focusing instead on relatively strong economic data. The S&P/TSX Composite Index advanced, led by the Information Technology and Consumer Discretionary sectors. In the U.S., the S&P 500 Index posted a positive return, benefiting from the strong performance of the Communication Services sector. Oil and gold prices both declined over the week. Yields on 10-year government bonds in Canada and the U.S. ticked higher.
Unemployment in Canada falls to record low, remains steady in U.S.
Canada’s unemployment rate fell to a record low of 4.9% in June, as a result of fewer people looking for work, according to Statistics Canada.
The drop occurred despite the loss of 43,000 jobs from the economy in June, primarily from 59,000 fewer self-employed jobs.
The services sector lost 76,000 jobs, while the manufacturing sector added 33,000 jobs.
The U.S. unemployment rate held steady at 3.6% in June, according to the U.S. Bureau of Labor Statistics. The economy added 372,000 jobs during the month.
Canada’s balance of trade improves
Canada’s trade surplus widened to $5.3 billion in May from 2.2 billion in April, according to Statistics Canada.
The increase was well above the market’s $2.4 billion forecast and represented the largest monthly surplus since August 2008.
Exports rose by 4.1% to a record $68.4 billion, driven by high prices for crude oil and bitumen, which accounted for 29.8% of the total.
Following three months of increases, imports declined by 0.7% to $6.1 billion in May.
U.S. trade deficit narrows
The U.S. trade deficit narrowed by US$1.1 billion to reach a five-month low of US$85.5 billion in May, according to the U.S. Bureau of Economic Analysis.
Exports rose by 1.2% to a record-high of US$255.9 billion, driven by crude oil, other petroleum products, travel and transport.
Imports rose by 0.6% to US$341.4 billion, weighed down by slower demand and higher prices.
Canadian mortgage debt grows
The Canada Mortgage and Housing Corporation reported residential mortgage debt in Canada grew by 9% in 2021 compared to 2020.
It was the fastest growth rate since 2008, driven by higher values and volume of new purchase mortgages and refinancing.
By the second half of 2021, variable-rate mortgages had grown to 53% of the total.
Comments