Strength in the energy sector combined with some positive economic news to kick off the trading week helped sa国际传媒's main stock index achieve triple-digit gains Monday.
The S&P/TSX composite index was up 179.89 points at 21,537.45.
The gain came as U.S. stock markets were closed for the Martin Luther King Jr. Day holiday.
鈥淚t鈥檚 been a good day for the TSX," said Pierre Cl茅roux, vice-president of research and chief economist for the Business Development Bank of sa国际传媒. "The TSX was positive very early today, and it kept the story all day."
Leading the charge was the energy sector, with the S&P/TSX Capped Energy Index up 1.72 per cent to 193.58. Some of the biggest winners were Advantage Oil & Gas Ltd., which was up 3.5 per cent; Baytex Energy Corp., which was up 3.1 per cent; and Arc Resources Ltd., up 3.09 per cent.
The March crude oil contract was up $1.68 cents at US$83.30 per barrel and the February natural gas contract was down approximately one cent at US$4.26 per mmBTU.
Cl茅roux said global demand for oil continues to outpace supply, which is the reason the benchmark West Texas Intermediate price has been so strong in recent months.
"The fundamental reason is the fact that we have underinvested in oil for the past several years, probably since 2014," he said. "There's not a lot of investment to increase the supply, and on top of that there have been political issues around the world, like OPEC maintaining a policy of not increasing supply. And Omicron doesn't seem to be slowing down the demand for oil around the world."
The strong performance of Canadian energy stocks indicates that investors believe elevated oil prices are here to stay, at least for a while, Cl茅roux added.
In addition to energy, Canadian banks also saw gains during Monday's trading, with the S&P/TSX Capped Financials Index up 1.15 per cent.
Cl茅roux said markets were likely reacting to two positive economic releases Monday. The Bank of sa国际传媒's quarterly survey of businesses 鈥� which was conducted before the arrival of the Omicron variant 鈥� showed business owners are concerned about rising inflation and supply chain challenges, but are generally feeling quite positive in terms of their recovery from the COVID-19-related recession.
That, in addition to Statistics sa国际传媒's November 2021 manufacturing numbers, help to paint an optimistic economic portrait, said Cl茅roux.
"Manufacturing sales increased about 2.6 per cent in November, so that's another positive piece of news that probably helped the markets today," he said.
The Canadian Real Estate Association said Monday annual home sales reached a new high in 2021, eclipsing the previous record set in 2020 by about 20 per cent.
In general, the Canadian economy is performing quite well, despite the current Omicron wave, Cl茅roux said.
"Personally as an economist I believe Omicron won鈥檛 have a big impact on growth this year, and I think a lot of economists share that," he said. "So that鈥檚 probably reflected in why the market's increasing as well."
The Canadian dollar traded for 79.87 cents US compared with 79.71 cents US on Friday.
The February gold contract was down US$4.90 at US$1,816.50 an ounce and the March copper contract was down 13 cents at US$4.42 a pound.
This report by The Canadian Press was first published Jan. 17, 2022.
Companies in this story: (TSX:GSPTSE, TSX:CADUSD=X, TSX:AAV, TSX:ARX, TSX:BTE)
Amanda Stephenson, The Canadian Press
