Canada Stocks: TSX jumps to two-month high on U.S. inflation relief

Centerra Gold

10/08/2022 21:50

(Adds details throughout; updates prices)
    * TSX ends up 307.64 points, or 1.6%, at 19,885.94
    * Posts highest closing level since June 10
    * Tech sector jumps 4.2%
    * Financials advance nearly 2%

    By Fergal Smith
    Aug 10 (Reuters) - Canada's main stock index rose on
Wednesday to its highest level in two months, with technology
stocks leading gains after data showed U.S. inflation rising
less than expected last month.       
    The Toronto Stock Exchange's S&P/TSX composite index
 .GSPTSE  ended up 307.64 points, or 1.6%, at 19,885.94, its
highest closing level since June 10.
    Wall Street also rallied after U.S. consumer price data
raised hopes the Federal Reserve will cut back on super-sized
interest rate increases.  urn:newsml:reuters.com:*:nL4N2ZM3Y7
    Investors have worried that aggressive tightening by central
banks could push the global economy into a recession. 
    "Markets have good reason to cheer the CPI number finally,"
said Barry Schwartz, portfolio manager at Baskin Financial
Services. "It's taking a lot of heavy lifting by the central
banks to raise interest rates and talk down the economy and that
seems to be working."
    Canada is expected to report its inflation figures next
week. Investors are expecting a half-percentage-point interest
rate increase by the Bank of Canada in September after it hiked
last month by a full percentage point.
    "I would look for more muted hikes going forward in the
50-basis-point range as commodity prices have fallen a little
bit," Schwartz said.
    Energy prices have been a major driver of inflation.
    The Toronto market's technology sector jumped 4.2%, paced by
a 20.5% gain for Converge Technology Solutions Corp  CTS.TO 
after the company's adjusted earnings beat estimates.
    Heavily-weighed financials rose nearly 2%, while energy
added just less than 1% as oil prices settled 1.6% higher at
$91.93 a barrel.  urn:newsml:reuters.com:*:nL1N2ZM043
    The materials group, which includes precious and base metals
miners and fertilizer companies, advanced 1.4% despite a 21.6%
plunge in the shares of Centerra Gold Inc  CG.TO  after it 
reported quarterly results.
    CAE Inc  CAE.TO  was also a drag, with the 737 MAX simulator
maker's shares tumbling 17.6% after quarterly profit missed
expectations.  urn:newsml:reuters.com:*:nL4N2ZM3OF

 (Reporting by Fergal Smith; Additional reporting by Johann M
Cherian and Shreyashi Sanyal in Bengaluru; Editing by Shailesh
Kuber and Deepa Babington)
 ((Yohann.MCherian@thomsonreuters.com;))