What happened in the stock market
For this weekly news, we will mention interest rate, Canadian debt, job losses in May, El Salvador approving Bitcoin,.
All the Canadian markets were flat this week:
- CSE with a flat week;
- TSXV with a flat week
- TSX with a gain of 0,4%
Bank of Canada leaves key interest rate on hold at 0.25%. The rate has been on hold at its rock-bottom level since the onset of the pandemic last year and the central bank has said it won’t increase the rate until the economy has recovered. The bank says it expects the Canadian economy to rebound strongly starting this summer, led by consumer spending, as vaccinations proceed at a faster pace and provincial governments ease economic restrictions. The bank also says it expects annual inflation figures to hover around three per cent over the summer because of higher gas prices and comparing prices now to the low levels they were at last year because of the pandemic.
Canadian consumers are now carrying $2.1 trillion in debt, driven by mortgages. Rebecca Oakes, assistant vice-president of advanced analytics at Equifax, said the largest increases in consumer debt were in British Columbia and Ontario, a direct result of the high home prices in those provinces.
At the same time, the credit reporting agency said consumer credit card debt was at a six-year low, as reduced spending led to healthier habits around daily spending.
“Across the board in all age groups, we’re starting to see people pay more than they actually spend on a credit card, which is a real positive behaviour change in terms of consumers,” said Oakes, who said consumers paid $11 for ever $10 they spent in January 2021.
The Canadian economy saw a second straight month of job losses in May, and most of the positions shed were in part-time work, according to the latest data from Statistics Canada. Canada lost 68,000 jobs in May, adding to the drop of 207,000 in April. The majority of jobs lost were in part-time work, where 54,000 positions were shed. Meanwhile, full-time employment was little changed in May following a decline of 129,000 jobs in April. TD Senior Economist Sri Thanabalasingam said that while employment gains are expected in the coming months as provinces reopen and employers boost hiring intentions in the wake of a robust vaccine rollout plan, May’s decline is “concerning.”
El Salvador’s congress on Wednesday approved legislation that allows bitcoin to be used as legal tender, becoming the first country in the world to do so. “In the short term this will generate jobs and help provide financial inclusion to thousands outside the formal economy,” Bukele said in a video shown at the Bitcoin 2021 conference in Miami on Saturday and posted to his Twitter account. He also said 70% of El Salvador’s population does not have a bank account and works in the informal economy. Bitcoin could improve financial inclusion, he said.
Top picks of the week
iSIGN Media Solutions Inc.
High Tide Inc.
ALX Resources Corp.
Spearmint Resources Inc.
They did their IPO this week
Salona Global Medical Devices