The saying that the morning shows the day did not apply on Tuesday to Canada’s main stock index, as the fall it experienced in the morning, shortly after the market opened, was quickly reversed.
At 9:46 a.m. ET – not long after the market opened – the Toronto Stock Exchange’s S&P/TSX composite index was already facing southward, down 59.31 points, or 0.28 per cent, at 20,759.78. The index was pulled down by technology and material shares when investors anticipated U.S. inflation figures and the European Central Bank meeting to chart the monetary policy route.
The technology group lost one per cent as the U.S. tech-heavy Nasdaq index was impacted negatively by U.S. Treasury yields, which hovered near 3-1/2-week highs hit in the previous session.
Financial experts explained that cautious investing was the cause of the fall. The consumer inflation data of the United States is expected this Friday. The last rate the US released in April was 8.3 per cent. In March, it was 8.5 per cent. In comparison with the previous year, the inflation rate of the US was 4.2 per cent in April 2021 and 2.6 in March 2021.
Even though inflation has also been rising in Canada, it has fared better than most Western economies, with inflation standing at 6.8 per cent in April, while it was 6.7 per cent in March. However, when compared to the 2021 inflation figures of 1.0 per cent (January), 1.1 per cent (February), 2.2 per cent (March), and 3.4 per cent (April), it would be easy to understand why Canadians are no longer at ease about recent inflation figures which have pushed the cost of groceries up within a short period of time.
On the Canadian stock market this morning, the materials sector, which includes precious and base metals miners and fertilizer companies, shed 0.3 per cent, caused mainly by lower copper prices.
On the positive side, the heavyweight energy sector moved up marginally by 0.1 per cent, enjoying the stability of oil prices as the market balanced risk sentiment with supply concerns and the hope of increased demand as China relaxes its COVID lockdowns.
Cronos Group Inc led the early morning gainers on the Toronto Stock Exchange with 4.5 per cent, followed by Arc Resources, which gained 2.8 per cent.
On the flip side, Aritzia Inc suffered the biggest morning loss, shedding 3.7 per cent, followed by NFI Group Inc, which lost 3.6 per cent.
But the fortune of the TSX experienced a significant turnaround in the morning as it quickly faced north and continued to move up. By 10.50 am ET, it had risen to 20,869.35. It was to drop to its lowest level for the day at 11.55 am ET at 20,822.11.
However, seemingly determined not to end the day on a negative note, the TSX changed course again and began to move upward. By 1.15 pm ET, it stood at 20,853,47. By 2.00 pm ET, it had further gone up to 20,866.20. And by 2.16 pm, the TSX was up 68.53 points or 0.33 per cent, at 20,888.51.
Many companies gained big with most energy stocks gaining the highest. Baytex Energy Corp. was recording the highest gain of 6.87 per cent. Vermilion Energy Inc. followed closely with 6.09 per cent. Arc Resources Ltd was rising by 5.29 per cent, while Tamarack Valley Energy Ltd. and Crescent Point Energy Corp. were gaining 5.05 per and 4.94 respectively.
The losers’ chart was led by Nutrien Ltd., which lost 3.70 percent. Canfor Corp. was close behind with 3.50 per cent. Capstone Copper Corp. was shedding 3.35 per cent. NFI Group Inc. was lighter by 3.34 per cent, while Aritzia Inc. was weaker by 3.06 per cent.
Meanwhile, the latest forecast from Goldman Sachs commodity analysts led by Jeff Currie seemed to have dampened the hopes of owners of motor vehicles who expect that they would get a reprieve from rising gasoline prices soon. Their forecast of oil prices over the next 12-18 months stated that they now expect that oil prices — which are measured by the Brent crude international benchmark BRN00, 0.83 per cent — will rise to nearly US$140 a barrel as early as this summer.
On the stock markets across the border in the US, it was green all over as the Dow Jones Industrial Average was up 154.33 points or 0.47 per cent at 33,070.11.
NASDAQ Composite Index rose 74.86 points or 0.62 per cent at 12,136.23, while the S&P 500 Index rose 23.27 points or 0.56 per cent at 4,144.70.
As predicted, Canada’s S&P/TSX Composite Index ended the day’s trading on a positive note, up 94.98 points or 0.46 per cent at 20,914.07.
Since this week took off, our investment-savvy readers have shown more interest in energy, mining and health care.
Trillion Energy has announced a marketed public offering of units for gross proceeds of up to $12,000,000.
Athabasca will be added to the S&P/TSX Composite Index prior to the opening of trading on June 20, 2022.
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