TORONTO — Canada's main stock index was up almost 200 points on Wednesday, buoyed by strength across all sectors on news of a half-percentage point interest rate hike, while U.S. markets were mixed, weighed down by tech stocks.
The S&P/TSX composite index was up 182.75 points at 19,279.76.
In New York, the Dow Jones industrial average was up 2.37 points at 31,839.11. The S&P 500 index was down 28.51 points at 3,830.60, while the Nasdaq composite was down 228.13 points at 10,970.99.
It’s not every day that Canadian markets go in a different direction to the U.S. markets. Michael Currie, vice-president and senior investment adviser at TD Wealth, attributed this difference to the Bank of Canada’s rate hike announcement of half of a percentage point, which was lower than some economists were expecting.
Markets are reacting to the possibility that the Bank of Canada plans to ease off on the rate hikes going forward, said Currie, though they aren’t done raising rates entirely.
“If we think we’re at the peak, that’s pretty much good news for every company,” he said.
“Most people would take it as a positive sign that we’re near the top.”
U.S. markets are likely also being pulled down by somewhat disappointing earnings results from Alphabet, Microsoft and Meta, said Currie.
"It's hard to underestimate what an incredible impact they have on the markets in its entirety just because they're so big," he said.
Almost every sector on the TSX was up, which is another rare occurrence, noted Currie.
Battery metals were up by almost 10 per cent, while the healthcare index and base metals were both up 2.5 per cent.
The telecom index was up more than three per cent, pulled up by Rogers Communications Inc. and Shaw Communications Inc. stocks on hope from analysts that Industry Minister François-Philippe Champagne may be willing to allow the two companies to merge in the future.
Shares in Rogers were up almost six per cent, while shares in Shaw were up by more than seven per cent.
The Canadian dollar traded for 73.72 cents US compared with 73.32 cents US on Tuesday.
The Canadian dollar continued to trend stronger on a weaker U.S. dollar and strength in oil, said Currie.
The December crude contract was up US$2.59 at US$87.91 per barrel and the December natural gas contract was down 4.7 cents at US$6.12 per mmBTU.
The December gold contract was up US$11.20 at US$1,669.20 an ounce and the December copper contract was up 14.8 cents at US$3.55 a pound.
This report by The Canadian Press was first published Oct. 26, 2022.
Companies in this story: (TSX:GSPTSE, TSX:CADUSD=X, TSX:RCI.B, TSX:SJR.B)
The Canadian Press
Note to readers: This is a corrected story. A previous version included the wrong day of the week for the comparison of the Canadian dollar.
