TSX rises as miners, technology take lead on China optimism

Connect with us

Dec 9 (Reuters) – Canada’s main stock index rose on Friday, buoyed by commodity-linked shares as crude and metal prices gained on hopes of a demand recovery in China following an easing of its stringent COVID-19 restrictions.

At 1007 a.m. ET (1507 GMT), the Toronto Stock Exchange’s S&P/TSX composite index (.GSPTSE) was up 100.76 points, or 0.5%, at 20,069.95. Still, the benchmark index is on track to record its biggest weekly drop in more than two months.

Commodity-linked stocks were among the top gainers, with energy (.SPTTEN) and materials (.GSPTTMT) sub-indexes rising 0.6% and 1.1%, respectively, on higher crude and gold prices.

Investors have geared up for a big week with major central banks including the U.S. Federal Reserve and the European Central Bank set to announce their stance on interest rates.

Data on Friday showed that U.S. producer prices increased a bit more than expected in November, but the underlying trend in inflation is moderating, which could allow the Federal Reserve to slow its pace of rate hikes.

“You have this balancing act that the Fed and the Bank of Canada need to do, bring down the economy slowly to bring down inflation, but don’t bring it down too much where the whole country goes into a deep recession,” said Allan Small, senior investment adviser at Allan Small Financial Group.

The Bank of Canada had hiked its overnight lending rate by 50 basis points on Wednesday.

Technology stocks (.SPTTTK) also contributed to the benchmark index’s gains on Friday, with Shopify (SHOP.TO) advancing 4.1% after Wells Fargo raised its price target.

On the year, the TSX has outperformed the U.S. S&P 500 index (.SPX) with a 5.6% loss vs the S&P’s drop of 17%.

Among single stocks, Laurentian Bank of Canada (LB.TO) climbed 7.2% to top the TSX after the lender beat its fourth-quarter profit estimate.

Reporting by Shashwat Chauhan in Bengaluru; Editing by Sriraj Kalluvila and Sherry Jacob-Phillips

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

Leave a Reply

Your email address will not be published. Required fields are marked *