Surging commodity and energy prices have pushed Canada’s stock market to a record high.
The S&P/TSX Composite Index gained 1.4% yesterday (March 17) to close at a record 21,771.22 as investors continue to buy stocks of oil and gold producers amid the escalating war in Ukraine.
Shares of energy and materials companies have been strong this year, making them the two best-performing groups in Canada as markets reel from a tight oil market, high inflation, and a rising interest-rate environment.
With oil firms and mining companies making up almost a third of the benchmark, Canadian stocks have outperformed their U.S. counterparts so far this year.
The S&P/TSX Composite index has gained 2.6% year to date, while the S&P 500 index is down 7% over the same period. Bank stocks, which comprise about 33% of the Canadian index, have also advanced this year as the Bank of Canada raised interest rates and signaled that more hikes are on the way.
U.S. stocks have outperformed Canadian stocks every year since 2011 (except for 2016), leading to a long-term performance gap, according to data from Bloomberg Markets.
