12:17 PM EST, 12/06/2024 (MT Newswires) -- The Toronto Stock Exchange is up 75 points, after earlier reaching an intra-day high of over 25,800.

Technology stocks are the biggest gainers, up 2%, with Shopify (SHOP.TO) hitting a new high of $170.75.

Limiting gains are declines in energy (-2%) and miners (-1.1%).

Oil prices fell for a third day early Friday as traders eye the impact of OPEC+'s decision to delay and extend the return of voluntary production cuts to market amid expectations supply will soon begin to swell above demand.

But gold traded higher as the dollar fell after the United States added more new jobs than expected last month.

On the employment numbers here, the Canadian labour market gained 50.5k positions in November. Most of them were full-time jobs, which rose 54.2k, while part-time employment fell 3.6k. The unemployment rate rose 0.3 percentage points to 6.8% as more people joined the labour force (+138k). The labour force participation rate rebounded 0.3 percentage points to 65.1% after two months of decline. But despite so many new jobs, total hours worked fell 0.2% month-on-month due to labour disputes. Wages were up 4.1% year-on-year (from 4.9% in October).

TD Economics in looking at the key implications said today's jobs report had "a lot of moving parts". While the unemployment rate rose significantly, this was due to a massive increase in the labour force rather than outright job losses. It noted that Statcan has cautioned people on using its jobs report population figures, which don't match recent demographic data -- and this also means caution around labour force figures. "So," TD said, "we should be taking this with a heavy hand of salt. Rather, we focus on the trend, where employment growth has held up well, with cyclically sensitive sectors driving gains over the last few months."

The Bank of Canada, TD noted, will make an interest rate announcement next Wednesday and markets are still on the fence as to whether the bank will cut by 50 or 25 bps. TD noted the BoC accelerated its rate cutting cycle with a 50 "beeper" in October as weak growth and an inflation undershoot raised fears that it was behind the curve. But since then, TD said, economic data have shown more resilience, with consumer spending, the real estate market, and price pressures rebounding. Even with the "messiness" of today's employment report, TD added, the economy continues to add jobs, reinforcing TD's view that the labour market is on "solid foundations". "We think this should be enough to convince the central bank to revert to a 25 bp cut next week, but it will remain a close call for the central bank."

Over at Desjardins, Royce Mendes said with recent data providing conflicting information about the state of the Canadian economy, the jobs report was left as the tiebreaker ahead of next week's BoC's rate decision. "The news was mostly good," he added.

Mendes noted the unemployment rate jumped three ticks to 6.8%, but said in this case it was due to more people looking for work rather than a sharp rise in those losing jobs. He also noted while total hours worked were 0.2% lower during the month, Statistics Canada says that was a result of labour disputes. Separately, he said, wage growth "looked much tame"r, with the annual rate of increase for all employees rising just 4.1%, after increasing 4.9% in October. "The jump in the unemployment rate overstates the weakness in today's report," Mendes added.

For RBC the bottom line is that details underlying the November labour market data were mixed, but the rise in the unemployment rate, alongside a slowing in wage growth, should reinforce that interest rates are higher than they need to be to keep inflation at the BoC's inflation target. RBC's base-case expectation remains that the BoC will cut the overnight rate by another 50 basis points next week.

Meanwhile, BMO Economics noted U.S. nonfarm payrolls rebounded to a "solid" 227k in November, modestly above the consensus forecast looking for 220k. There was also a "favorable" 56k upward revision to the previous two months of estimates. This brings the 3-month average of monthly job growth up to a more comfortable 173k a month from 123k in October.

For BMO the "solid" nonfarm payroll gain and strong earnings growth should keep the U.S. economic expansion on a "sturdy foundation", even as a gradually rising unemployment rate moderates demand and inflationary pressures over time.

Absent a big upside surprise in October CPI next week that could raise the odds that the Fed chooses to pause rate cuts, RBC thinks today's data is "still soft enough to argue for additional rate cuts", and it expects a 25-bps cut from in the December.

CIBC said the Fed "has reason enough" to cut rates a further quarter point in December. "If, as we expect, we start to see a deceleration in wages in 2025 and the moderation in hiring continues, a quarter point per meeting would still be a reasonable pace until rates are closer to neutral, in the mid-3% range."