Recap: Week Ending October 16, 2015

October 19, 2015

Equities in the United States were able to climb higher last week as Canadian markets were unable to maintain its weekly win record. The NASDAQ 100 index led the way higher last week in the United States, climbing 1.57% to finish Friday at 4,438.62. On the other hand, the Dow Jones Industrial Average was the worst performing index in the United States, closing up 0.77% last week. That move higher last week was good enough for the Dow to settle at 17,215.97 on Friday. The push higher last week is the third straight weekly gain for US indexes and comes on a shortened holiday week. Markets were partially closed in the United States as well as fully closed in Canada on Monday for Columbia Day and Thanksgiving respectively. North of the border such gains were unattainable with the Toronto Stock Exchange, or TSX, falling 0.9% last week to settle Friday at 13,383.10. The Canadian economic calendar last week was relatively light with the bulk of smaller data being released Friday. Friday’s manufacturing shipments and foreign portfolio investment had little impact on the market as the market traded in a narrow daily range. It will be important to see if the TSX can maintain it’s upwards push this week as it will be a full trading week, and investors and traders will be more active. Currently, the Canadian equity benchmark index is still looking to push itself off of the lows that it made towards the end of August. With regards to other North American indexes, the TSX is still lagging heavily in regards to its recovery from this low point in the market. The move lower last week in the price of North American Crude did not assist the TSX in gaining such ground as the energy product fell $1.76 or 3.56% last week to settle at $47.73. Currently crude is trading in a very narrow range with any deviation from that range resulting in a push back forwards the original zone of acceptance. With this being said, gold appears as though it is looking to get something started towards the upside after seeing two straight weeks of upside action. Last week the price of the precious metal climbed $21.80 or 1.89% to settle Friday at $1,177.40. The zone that gold is currently trading at it technically key as it is slightly below its 50-week simple moving average or SMA. Currently, the 50 week SMA is trading at 1,180, signally an area of resistance to the upside. The last time that the price of gold hit its 50 SMA the metal fell almost 13% or $160 before bottoming. It will be important to see if gold will be able to break through this moving average or if it will once again fall short at its 50 week SMA. If this moving average does indeed act as upside resistance once again, the TSX may suffer as the price of gold would not be able to prop up such mining companies listed on the TSX.

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