Canada Stocks: TSX muted as energy shares counter gains from CPI data

I3 Energy

20/08/2024 15:52

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      TSX muted 
    

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      Energy leads sectoral losses, materials leads gains
    

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      Canada CPI cools to 40-month low 
    

  
 (Updated at 9:56 a.m. ET/ 1356 GMT)
    By Nikhil Sharma
       Aug 20 (Reuters) - Canada's main stock index was subdued
on Tuesday as losses in energy shares kept a check on gains from
the consumer prices data that showed inflation cooled to a
40-month low in July, raising hopes for another rate cut next
month. 
    At 9:56 a.m. ET (13:56 GMT), the S&P/TSX composite index
 .GSPTSE  was up 3.48 points, or 0.02%, at 23,119.87, hovering
around its record highs.
    The country's annual inflation rate dropped to 2.5% in July,
while it was up 0.4% on a monthly basis, indicating the Bank of
Canada could lower rates again in September.
    "We get retail sales numbers this week. If it shows a
continued weakness, then it sets the pathway for them to
continue cutting at each meeting for the rest of the year,"
Macan Nia, co-chief investment strategist at Manulife Investment
Management, said.
    According to a Reuters poll, the benchmark index can extend
its record-setting rally in the coming months and through 2025
as lower borrowing costs combat possible effects from slower
economic activity on corporate earnings.
    On the Toronto Stock Exchange, energy  .SPTTEN  led the
sectoral losses, sliding nearly 1% despite a rise in oil prices.
        Tech  .SPTTTK  and capped communications  .GSPTTTS 
shares were also among the top losers, down around 0.4% each.
    Materials shares  .GSPTTMT  led the gains with a 1.4% rise,
tracking gold prices that hit a record high against a weaker
dollar amid higher bets for a U.S. September rate cut.
    Among individual stocks, Gran Tierra Energy fell more than
5% after the company offered to buy London's i3 Energy  I3E.L 
in a deal valued at 174.1 million pounds ($226.23 million).
        A key event this week would be U.S. Federal Reserve
Chair Jerome Powell's commentary at the Jackson Hole Economic
Symposium on Friday, amid acknowledgments of a possible rate cut
in September.
    Markets expect a 25-basis points reduction at the U.S.
central bank's policy meeting next month.  0#FEDWATCH 

 (Reporting by Nikhil Sharma in Bengaluru; Editing by Shreya
Biswas)
 ((Nikhil.Sharma@thomsonreuters.com;))