North American shares headed higher in the afternoon with financial markets calmer following days of volatile trading and steep losses.
The S&P/TSX composite index was up 0.2 per cent to 15,397 points in Toronto — its first two-day gain in almost a month.
The benchmark index snapped a six-day losing streak on Tuesday as Wall Street also bounced back near the end of the trading day.
Gains in the market Wednesday were led by the utility and consumer discretionary sectors.
On the other end, shares of investment firm Canaccord Genuity fell nearly 4.5 per cent despite the fact its third-quarter revenue beat expectations.
The Canadian dollar, meanwhile, was trading at 79.68 US cents, reversing morning gains to head lower than Tuesday’s average of 79.81 cents.
The loonie has weakened in the last few days as investors flee to the safety of the U.S.dollar amid volatility.
The CBOE Volatility index, known as the VIX, which is considered the best gauge of expected volatility on Wall Street, was at 21 — about double where it was two weeks ago.
But, it had spiked above 50 on Tuesday.
Mark McCormick of TD Securities said the recent market action signals investors are not ready for “upside surprises” in inflation, given years of “downside misses.”
“The primary takeaway is that markets are not prepared for an abrupt tightening of financial conditions,” he said in a note.
“Now, equity valuations (particularly in the US) might look much less attractive against higher real rates.”
The downward market spiral began on Friday after U.S. jobs data showed wages growing faster than expected, which raised the prospect of higher inflation that could prompt the Federal Reserve to raise interest rates by more than expected.
In New York, the Dow Jones industrial average was higher by 0.8 per cent to 25,121 points.
Volatile trading Tuesday saw the Dow Jones lose as much as 567 points in the morning, followed by a 569-point surge near the end of the day to finish higher by 2.3 per cent.
On Tuesday, it had briefly entered into correction territory, which is a 10 per cent drop from its peak.
The S&P 500 was up 0.7 per cent to 2,714, while the Nasdaq composite remained flat at 7,113 points.
Industrials and consumer discretionary sectors were among the big gainers, along with casino giant Wynn Resorts.
Its shares rose over eight per cent after CEO Steve Wynn resigned in the wake of allegations of sexual misconduct.
U.S. President Donald Trump took to Twitter for the first time to post his view of what’s been happening in the markets on Wednesday.
In the “old days,” when good news was reported, the Stock Market would go up. Today, when good news is reported, the Stock Market goes down. Big mistake, and we have so much good (great) news about the economy!
Around the world
Asian markets closed mixed overnight, taking cues from the volatile trading day in North America on Tuesday.
The region’s biggest market — Japan’s Nikkei 225 index — finished higher by 0.2 per cent to 21,645, while Hong Kong’s Hang Seng index was down 0.9 per cent to 30,323 points.
Mainland Chinese shares saw bigger losses with the Shanghai composite down 1.8 per cent to 3,310.
In Europe, the benchmark Stoxx 600 index closed higher by over two per cent — with all major stock exchanges and sectors in positive territory.