Canada’s main stock index soared more than 300 points on Wednesday as investors cheered Shopify’s quarterly results, while U.S. markets also rose.
TORONTO — Canada’s main stock index soared more than 300 points on Wednesday as investors cheered Shopify’s quarterly results, while U.S. markets also rose.Shopify’s shares closed at $212.82, up $37.66 or 21.
5 per cent. That contributed the bulk of the TSX’s gains, said Ian Chong, portfolio manager for First Avenue Investment Counsel Inc. The Ottawa-based e-commerce software company reported a profit of US$906 million in its latest quarter, up from US$171 million a year ago, as its revenue grew by 31 per cent. “The results were very good,” said Chong, noting Shopify accounts for about seven per cent of the TSX’s total weight. He added the results were driven by factors such as strong gross merchandising volume growth, lower operating expenses and “robust” guidance for its next quarter. “It’s citing strong continued merchant acquisition, international expansion opportunities and robust product uptake by the merchants, so all that is very, very positive for the top line,” said Chong. The company has also been unfazed by the U.S.-Canada trade dispute, with management highlighting on Shopify’s conference call with analysts that merchants “have remained quite flexible and quite resilient.” “U.S.-Canadian cross-border transactions consist of about 15 per cent of total and that has been relatively constant, so they’re not seeing any negative impact or any pressures from the ongoing tariff situation,” said Chong. In New York, the Dow Jones industrial average was up 81.38 points at 44,193.12. The S&P 500 index was up 45.87 at 6,345.06, while the Nasdaq composite was up 252.87 at 21,169.42.Large-cap stocks led the U.S. market higher, said Chong, particularly gains by tech stocks that make up the Magnificent 7, with the exception of Microsoft. Apple alone accounted for nearly half of the S&P 500’s gain ahead of an announcement at the White House on increasing its U.S. investments by an additional US$100 billion over the next four years. Apple had previously said it intended to invest US$500 billion domestically, a figure it’ll now increase to US$600 billion. U.S. President Donald Trump had criticized the tech company and CEO Tim Cook for efforts to shift iPhone production to India to avoid the tariffs his administration had planned for China. But the White House called Wednesday’s announcement with Apple a victory for the U.S. manufacturing industry.“He’s trying to onshore or re-shore a lot of production back onto domestic soil and Apple is doing this to try and hopefully have Trump go a little bit more easy on the company.” Trump signed an executive order Wednesday to place an additional 25 per cent tariff on India for its purchases of Russian oil. That brings the combined tariffs imposed by the U.S. on that country to 50 per cent.The September crude oil contract was down 81 cents US at US$64.35 per barrel.—With files from The Associated Press
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