Goodbye June...Hello July!
TSX +83.96 to 13,188.94 (CP) its third consecutive day of solid gains as traders took in stronger than expected inflation data and news that Greece had passed an austerity bill that should help Athens avoid defaulting on its debt. The surprisingly strong inflation results could put pressure on the Bank of Canada to take a more hawkish tone on inflation in the next interest rate announcement in less than three weeks. The bank had warned it expected inflation to push above three per cent during the spring, but few expected it would hit such elevated levels.
DOW +72.73 to 12,261.42.
Dollar +1.27c to 103.03c USD.
Oil +$1.88 to $94.77USD per barrel Oil and gold prices appear to have moved past recent lows, a trend that bodes well for the performance of the resource-heavy TSX . Over two days, oil has recovered the loss from last Thursday when the United States and other oil-importing countries said they would dump emergency oil supplies onto the market.
Gold +$10.40 to $1510.20USD per ounce.
Canadian 5 yr bond yields markets +.15bps to 2.30. That’s an increase of 30bps since Monday's low! The spread (based on the MERIX 5 yr rate published rate of 3.79%) is now down to the middle of the comfort zone at 1.49 as money moves away from bonds to stocks. The spread based on the quick close of 3.59% is well below the bottom of the comfort zone at 1.29.
