TORONTO — Canada's main stock index briefly hit another 2019 high Thursday but North American markets ended relatively flat on anticipation that the start of first-quarter reports will see U.S. corporate earnings down for the first time in about three years.
It was a quiet day on both sides of the border before U.S. banks provide on Friday the first financial signals about the quarter, said Michael Currie, vice-president and investment adviser at TD Wealth.
"A lot of people are thinking it's not the worst strategy to maybe take a little profit in case there's some negative surprises," he said in an interview.
Earnings on the S&P 500 index are expected to fall 2.5 per cent in the quarter, the first year-over-year declines in about three years, although revenues should be higher, Currie noted.
He said the results will either mark a one-quarter blip or a sign of something more negative to come.
"The fact that the markets are up as much as they are this year will have people leaning towards the first camp, that this is just a one-quarter drop along the way and things are generally still pretty healthy."
The S&P/TSX composite index closed up 3.18 points to 16,399.47 after hitting a high for 2019 at 16,471.82.
In New York, the Dow Jones industrial average was down 14.11 points at 26,143.05. The S&P 500 index was up 0.11 points at 2,888.32, while the Nasdaq composite was down 16.88 points at 7,947.36
U.S. markets changed little despite good data, including wholesale cost of U.S. goods and services increasing in March and jobless claims hitting a near 50-year low.
Currie said the first-quarter results are going to be important.
"The numbers are saying it's going to be a weak season but the market is saying they're not too worried about it because we wouldn't be up 14 per cent year-to-date if people were worried that it's going to be a long-term thing."
Technology led the TSX as Shopify Inc. gained 2.55 per cent.
Health care dropped three per cent after a downgrade by Scotiabank caused Cronos Group, Canopy Growth Corp. and Aphria Inc. to lose 6.6, 5.1 and 3.5 per cent respectively.
Oil and gold prices fell as a stronger U.S. dollar also weighed down on the loonie.
The Canadian dollar traded at an average of 74.75 cents US compared with an average of 75.04 cents US on Wednesday.
The May crude contract was down US$1.03 at US$63.58 per barrel and the May natural gas contract was down 3.6 cents at US$2.66 per mmBTU.
The June gold contract was down US$20.60 at US$1,293.30 an ounce and the May copper contract was down 3.85 cents at US$2.89 a pound.
Companies in this story: (TSX:SHOP, TSX:CRON, TSX:WEED, TSX:APHA, TSX:GSPTSE, TSX:CADUSD=X)