Canada’s main stock index opened higher on Tuesday, helped by technology shares, as investors assessed U.S. inflation data and digested the Bank of Canada’s key policy decision.
The TSX swooned 121.09 points to open Wednesday to 25,504.33.
The Canadian dollar hiked 0.26 cents to 70.81 cents U.S.
The Bank of Canada cut its key interest rate by 50 basis points to 3.25%. The Bank Rate is now 3.75% and the deposit rate is 3.25%.
The top bank has reduced its key policy rate by 125 basis points since June amid worries about the country’s lukewarm economic growth, even as annual inflation came within its target range of 2%.
In corporate news, forest and wood products firm Canfor Corporation announced it has acquired 7% of outstanding shares of its Swedish peer VIDA AB effective today. Canfor shares edged up three cents to $16.52.
ON BAYSTREET
The TSX Venture Exchange recovered 2.46 points to 615.13.
Seven of the 12 TSX subgroups were down in the first hour, weighed most by health-care, down 2.9%, communications, sliding 1.5%, and utilities, off 0.8%.
The five gainers were led by gold, up 1.7%, materials, improving 0.9%, and information technology, ahead 0.8%.
ON WALLSTREET
Stocks rose Wednesday after November’s inflation report met economists’ projections, clearing the way for the Federal Reserve to cut interest rates again at its December meeting next week.
The Dow Jones Industrial index dipped 16.73 points to begin Wednesday at 44,231.10.
The S&P 500 index regrouped 40.12 points to 6,075.03
The NASDAQ Composite ballooned 245.96 points, or 1.3%, to 19,933.20
Nvidia, Tesla and other bull market leaders led the gains following the relatively tame inflation data. The chipmaker was nearly 2% higher, and Tesla advanced around 2%.
November’s consumer price index, which tracks a basket of goods and services, was in line with expectations. The reading showed a 0.3% rise from October and 2.7% increase from a year ago. Excluding volatile food and energy prices, core CPI increased 0.3% on the month and 3.3% on an annual basis.
While this inflation data represented a quicker pace from the prior month, traders speculated it was still not high enough to keep the Fed from cutting rates at its next gathering. Fed funds futures are pricing in a 99.9% likelihood that the central bank lowers rates at that gathering
Prices for the 10-year Treasury lagged slightly, raising yields to 4.24% from Tuesday’s 4.23%. Treasury prices and yields move in opposite directions.
Oil prices progressed $1.02 to $69.61 U.S. a barrel.
Prices for gold jumped $35.00 an ounce to $2,753.40 U.S.