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On a day the Bank of Canada made its last policy interest rate hike for the year, Canada’s main stock index struggled to remain green.

The Toronto Stock Exchange’s S&P/TSX composite index first opened lower today at 19,971.25. However, it shot up to 20,092.56 at 10:32 a.m. ET, gaining 102.39 points, or 0.51.

At 12 noon, it shed some weight but continued to remain green at 20,016.16, with a gain of 25.99 points, or 0.13 per cent.

Today, the Bank of Canada announced a 50-basis-point increase in its benchmark overnight interest rate to 4.25 per cent, which is the highest level in almost 15 years. With that, the central bank has raised interest rates by 400 basis points since March this year in response to inflation.

The central bank had raised interest rates by between 25 basis points to 100 basis points since March, gradually pushing the interest rate from 0.25 per cent in January to its current 4.25 per cent. The highest interest hike was in July when the Bank of Canada raised rates by 100 basis points, the highest single hike since 1998.

However, even though the central bank said it would continue its policy of quantitative tightening in 2023, it dropped some hints that it was close to the end of its tightening policy, thereby giving some measure of relief to investors.

The announcement by the central bank seemed to have given some stability to the stock index, as it lost the volatility that punctuated its morning trading.

At 12 noon, the consumer sector was leading the sectors in gains, adding 1.40 per cent, while the health sector was the biggest loser with 4.25 per cent.

The top-performing stocks were Endeavour Silver Corp., which rose by 6.68 per cent; OceanaGold Corp., which added 6.07 per cent; and MAG Silver Corp., which gained 5.92 per cent. Conversely, the least-performing stocks were Canopy Growth Corp., which lost 7.35 per cent; Tilray Inc., which shed 7.07 per cent; and ATS Corp., which dropped 3.61 per cent.

At the American markets, the S&P 500 was down to 3,934.08, losing 7.18 points, or 0.18 per cent.  The DOW was up 33,611.50, gaining 15.16 points, or 0.05 per cent. NASDAQ was down 10,958.35, shedding 56.54 points, or 0.51 per cent, while RUSSELL 2000 was up 1,814.30, gaining 1.73 points, or 0.10 per cent.

At the current exchange rate, the loonie firmed up against the American dollar, exchanging for US$0.7326 with a gain of 0.0006 cents, or 0.0861 per cent.

Crude oil fell to US$72.66 per barrel, losing $1.59, or 2.14 per cent, while gold futures moved up to US$1,794.70 per ounce, gaining $12.30, or 0.69 per cent.

In terms of periodic performance, the TSX has been making some losses in the past week. After staying above the 20,000 mark for ten days, the index fell on Tuesday to 19,990.17, losing 252.09 points, or 1.25 per cent, in a day.

The index has gained 3.47 per cent in the past month and 4.03 per cent in the past three months. However, in the past five trading days, the index has lost 2.14 per cent, an indication that things have not been rosy at the stock market in recent days.

Nonetheless, the downturn in the fortunes of Canada’s main stock index is not strange in the life of any dynamic stock market.

Market movers

The focus of our readers took a diversified approach in the first half of this week, spanning energy, technology and the industrial sectors.

The subsidiary of Valeura Energy Inc. (VLE) signed a $10.4 million sale and purchase agreement with Mubadala Petroleum Holdings Limited.

Hillcrest Energy (HEAT) has completed its 800-volt, 250-kilowatt Zero Voltage Switching (ZVS) traction inverter commercial prototype.

Transport giant Bombardier (BBD.B) has cut approximately C$500 million from its second-quarter cash usage to conserve liquidity during the pandemic.

Finally, capital raises so far this week include Exro Technologies, Brunswick Exploration, Delta Resources, Equity Metals, Ucore Rare Metals, Rackla Metals, Yangaroo, Exploits Discovery Corp., Meridian Mining, Manganese X Energy, Banyan Gold, and Bayhorse.


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