TORONTO — Canada’s main stock index rose nearly 250 points on Friday, as investors sifted through the latest employment figures.
The domestic job market took a leap toward recovery in July. Statistics Canada said on Friday that the unemployment rate edged lower to 6.4 per cent in the month as the economy added 75,000 jobs. A Reuters poll ahead of the release showed Bay Street was expecting a modest 15,000-job gain.
But economists say there’s still a long road ahead before the Bank of Canada considers tightening policy.
“I would be hoping for interest rate cuts, but with strong jobs data and inflation slightly above target on the headline number, although the core is right at target, I think the Bank of Canada just stands … it doesn’t do anything,” said Allan Small, senior investment adviser at iA Private Wealth.
“I don’t think we’re going to see a raise; I don’t think we’re going see a cut.”
Financial market odds were about 96 per cent in favour of a hold from the Bank of Canada at its Sept. 2 meeting, according to LSEG Data & Analytics.
The S&P/TSX composite index was up 244.92 points at 36,381.23. The basic materials sector led the gains, helped by rising gold prices. The December gold contract was up US$100.10 at US$4,399.70 an ounce.
The rise in gold came amid weaker employment data from the U.S.
The U.S. government reported that employers unexpectedly cut 23,000 jobs last month. The report included a revision to the figures for June and May that involved slashing a combined 103,000 jobs from payrolls for those months.
That could reduce the odds of a rate hike from the U.S. Federal Reserve.
“With today’s data showing weakness, with the odds of a rate increase now off the table or at least lower than 50 per cent, now everybody’s saying ‘Gold is back on,’” Small said.
In New York, the Dow Jones industrial average was up 151.83 points at 54,036.93. The S&P 500 index was up 47.68 points at 7,757.64, while the Nasdaq composite was up 342.26 points at 26,690.62.
A weakening U.S. jobs market could make matters more complicated for the Fed, which has to balance supporting job growth with fighting inflation. The Fed has been holding interest rates steady amid worries about hotter inflation, fueled by a rise in oil prices because of the U.S. war with Iran.
In the oil market, prices rose on Friday.
“It’s one of those things where everybody’s waiting to see what’s going to happen, we’re hearing different things. Iran keeps saying something different than the U.S.,” Small said.
The September crude oil contract for North American benchmark West Texas Intermediate was up 89 cents US at US$78.18 per barrel.
The Canadian dollar traded for 71.72 cents US compared with 71.34 cents US on Thursday.
The December gold contract was up US$100.10 at US$4,399.70 an ounce.
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Daniel Johnson, The Canadian Press
With files from The Associated Press
This report by The Canadian Press was first published Aug. 7, 2026.
