TSX moves further into record territory despite energy pullback

Canada's main stock market moved further into record territory Monday despite a relatively quiet day marked by a pullback in the key energy sector.

TORONTO -- Canada's main stock market moved further into record territory Monday despite a relatively quiet day marked by a pullback in the key energy sector.

There was “little conviction'' overall in equity markets to start the trading week even as investors are focused on earnings season, which has started very strongly, said Craig Fehr, investment strategist, Edward Jones.

“While that led to a positive week last week, we're seeing some consolidation today. But I would say broadly it's a positive trend when we're going to see equities pivot their sights toward corporate profits because that continues to be probably the brightest element of the fundamental backdrop at the moment,'' he said in an interview.

Fehr said there's a lot more occurring beneath the surface with a rebound in communications and technology that favours the S&P 500 and Nasdaq over the Dow.

“The TSX has been on a roll,'' he said pointing to the heavyweight financials services sector that has benefited from the prospects of higher rates and faster loan growth.

“But at the same time, obviously the tear that oil has been on has benefited energy stocks, and so that's where we've seen some divergences between the Canadian stock market and the U.S. market.''