Markets in the U.S. and Canada rose on Monday, helped by gains in technology stocks.
Kathryn Del Greco, senior investment advisor at TD Wealth, said that the focus on tech stocks came after a challenging environment took hold last week, particularly for software companies.
“There’s definitely some bargain hunters stepping into the market today,” she said.
The S&P/TSX composite index was up 552.34 points at 33,023.32.
In New York, the Dow Jones industrial average was up 20.20 points at 50,135.87. The S&P 500 index was up 32.52 points at 6,964.82, while the Nasdaq composite was up 207.46 points at 23,238.67.
The U.S. stock market was coming off its best day since May to close last week, but several concerns are still lingering. That includes criticism that stocks have simply become too expensive following their run to records.
Worries are also heavy about whether all the huge spending by big tech and other companies on artificial intelligence technology will produce enough profit to make the investments worth it.
Some of the winners from that rush into AI drove the market higher on Monday. Chip companies rose, for example, with Nvidia up 2.5% and Broadcom up 3.4%. They were two of the strongest forces pushing the S&P 500 upward.
“After last week’s big correction, I think there’s some money that is looking to deploy as this AI trade continues to play out,” Del Greco said.
She said the rise in Canadian tech stocks was a spill over from gains in the U.S. tech sector.
“You’re going to look for where there are opportunities, and the tech sector’s having a very nice recovery day in the U.S., and that’s certainly gonna pull along Canada as well,” she said.
Last week, the Dow Jones industrial average topped 50,000 points for the first time, which she said was a big milestone for the bellwether index that represents more than just large technology companies.
“For the last couple of years, it’s all been about the S&P 500 and the Nasdaq being big indexes,” Del Greco said.
“So when you see the good ol’ Dow reaching a new all-time high, it shows a broadening out of the market, which is actually extremely healthy for the sustainability of this bull market.”
The Canadian stock market also got some help from basic materials stocks as the price of precious metals rose.
Gold rose 2%. It’s been swinging sharply after roughly doubling in price over 12 months, and it has bounced between US$4,500 and nearly US$5,600 an ounce. Silver, whose price has been even wilder, jumped 6.9% Monday.
The April gold contract was up US$99.60 at US$5,079.40 an ounce. The March silver contract was up US$5.34 at US$82.23.
The Canadian dollar traded for 73.66 cents US compared with 73.27 cents US on Friday.
The March crude oil contract was up 81 cents US at US$64.36 per barrel.
— With files from The Associated Press
