CANADA STOCKS-Toronto market falls by most in 4 weeks as BoC turns more hawkish

  • 10/27/2021
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(Adds investor quotes and details throughout, updates prices) * TSX ends down 218.46 points, or 1%, at 20,954.99 * Bank of Canada signals earlier start to rate hikes * Oil settles 2.4% lower * Energy declines 2.6%; technology ends 1.8% lower TORONTO, Oct 27 (Reuters) - Canada’s main stock index fell on Wednesday as oil prices declined and the Bank of Canada signaled it could raise interest rates sooner than previously thought, with the index extending its pullback from a record high. The Toronto Stock Exchange’s S&P/TSX composite index ended down 218.46 points, or 1%, at 20,954.99, its biggest decline since Sept. 28. The index also fell on Tuesday, ending a winning streak of 14 trading days, its longest in Reuters data going back to 1979. On Monday, it notched a record closing high of 21,284.84. “A pretty potent combination of factors” weighed on the TSX on Wednesday, including lower oil prices, a mixed reaction to U.S. corporate earnings and the Bank of Canada policy announcement, said Elvis Picardo, a portfolio manager at Luft Financial, iA Private Wealth. “Any time a central bank gets a little bit more hawkish it sends a negative signal to the market,” Picardo added. The Bank of Canada signaled it could hike interest rates as soon as April 2022 and said inflation would stay above target through much of next year, due to higher energy prices and supply bottlenecks. Previous guidance from the BoC, which became the first central bank from a G7 country to exit quantitative easing, was for hikes to begin in the second half of 2022. U.S. crude oil futures settled 2.4% lower at $82.66 a barrel after industry data showed U.S. crude stockpiles rose more than expected, pressuring the energy sector. It declined 2.6%, while technology shares lost 1.8% and the heavily-weighted financial services sector ended 0.9% lower. Teck Resources Ltd reported an eight-fold jump in third-quarter adjusted profit, driven by higher prices for steelmaking coal on the back of surging demand from China. Its shares were down 1.3%. (Reporting by Fergal Smith; Additional reporting by Amal S in Bengaluru; editing by Grant McCool)

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