Major North American stock indexes showed mixed results on Friday as investors were cautious ahead of a holiday weekend in which a fresh round of U.S. tariffs on Chinese imports were due to be levied.
The Dow Jones Industrial Average rose 37.4 points, or 0.14 per cent, to 26,399.65, the S&P 500 gained 1.45 points, or 0.05 per cent, to 2,926.03 and the Nasdaq Composite dropped 10.51 points, or 0.13 per cent, to 7,962.88.
The Toronto Stock Exchange’s TSX rose 0.35 per cent to 16,442.07. Leading the index were Hudbay Minerals Inc, up 4.9 per cent, Interfor Corp, up 4.4 per cent, and CAE Inc, higher by 4.3 per cent.
Lagging shares were Birchcliff Energy Ltd, down 6.3 per cent, Peyto Exploration & Development Corp, down 4.8 per cent, and ARC Resources Ltd, lower by 4.1 per cent.
The most heavily traded shares by volume were Encana Corp, Bombardier Inc and Suncor Energy Inc.
The TSX’s energy group fell 1.10 points, or 0.9 per cent, while the financials sector climbed 1.00 points, or 0.3 per cent.
West Texas Intermediate crude futures fell 2.94 per cent, or $1.67, to $55.04 a barrel. Brent crude fell 1.06 per cent, or $0.65, to $60.43.
The TSX is up 14.8 percent for the year.
Wall Street ended the week with a lackluster session on Friday as investors were cautious ahead of a holiday weekend in which a fresh round of U.S. tariffs on Chinese imports were due to be levied.
While the S&P 500 registered its biggest weekly gain since June, August had its biggest monthly decline since May. Investors had fled risky assets in August due to escalations in the U.S.-China trade war and the inversion of a key part of the U.S. yield curve which is often a recessionary signal.
U.S. financial markets were due to stay closed on Monday for the Labor Day holiday and a new round of U.S. tariffs on some Chinese goods were expected to come into effect on Sunday. Trading volume was light as and the S&P swapping between negative and positive territory in the afternoon to end the day with little progress.
“People are becoming more defensive going into the weekend because we have three days where we can’t react to news and it’s three days that have a lot of uncertainty associated with them because of the tariffs,” said Robert Phipps, a director at Per Stirling Capital Management in Austin, Texas.
“Right now everything is evolving around the trade complex and probably will for the remainder of this year,” he said.
The United States and China had given hopeful signs on trade on Thursday as they discussed the next round of in-person negotiations in September.
But Randy Frederick, vice president of trading and derivatives for Charles Schwab in Austin, urged caution saying: “Frankly, markets have been overly optimistic about trade.”
Since bonds have recently outperformed stocks, investors may have taken early action to rebalance their portfolios for the end of the month due to the long weekend, according to Vinay Pande, head of trading strategies at UBS Global Wealth Management in New York.
U.S. consumer spending increased solidly in July as households bought a range of goods and services. While this could allay financial market fears of a recession, a survey from the University of Michigan, also out Friday, showed its consumer sentiment index in August dropping by the most since December 2012, amid nerves over the U.S.-China trade war.
“The news today has been mixed. There was positive news about consumption data and negative news on consumer confidence,” said Pande.
The Consumer Discretionary sector was the S&P’s biggest drag as Ulta Beauty Inc, which had been the S&P’s top performing stock in Wall Street’s decade-old bull market, tumbled 29.6% after the cosmetics company cut its full-year profit forecast.
One of the biggest percentage gainers on the benchmark index was Campbell Soup Co, which jumped 3.9% after its quarterly profit beat estimates.
With files from Reuters