TSX takes pause after two-day drop as U.S. CPI data meets expectations

  • 12/10/2021
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Dec 10 (Reuters) - Canada"s main stock index steadied on Friday, as the closely watched U.S. inflation print came in broadly in line with expectations, but sentiment remained fragile on pandemic jitters and uncertainty over U.S. monetary policy. After opening higher, the Toronto Stock Exchange"s S&P/TSX composite index (.GSPTSE) was flat at 20,920.54 after declining for two consecutive days. Still, the index is set to end the week 1.4% higher, snapping three straight weeks of losses. In the 12 months through November, the U.S. consumer price index accelerated 6.8% - its biggest year-on-year rise since June 1982. read more "Inflation numbers were high, and clearly there"s still pressure on the Federal Reserve, but markets had already priced that in," said Colin Cieszynski, chief market strategist at SIA Wealth Management. "The high inflation story remains unchanged, even though the data met estimates." As long as energy prices continue to stabilise, the index is set to log broad gains in December unless there is a significant external surprise, Cieszynski added. The energy sector (.SPTTEN) fell 0.4% despite a recovery in oil prices. But crude prices are on track for their biggest weekly gain since late August, with the Brent and WTI benchmarks both on course for gains of about 8% this week, their first weekly gain in seven. Laurentian Bank (LB.TO) gained 5% to the top of the index after reporting earnings results, where it announced a 10% increase in quarterly dividends and plans of a share buyback. The financials sector (.SPTTFS) gained 0.2%. Canada"s financial regulator said it was maintaining the amount of capital the country"s biggest lenders must hold to guard against risks at 2.50% of risk-weighted assets. The industrials sector (.GSPTTIN) rose 0.6%, while the materials sector (.GSPTTMT), which includes precious and base metals miners and fertilizer companies, added 0.2% as gold futures rose 0.6% to $1,785.4 an ounce. HIGHLIGHTS Ontario-based electricity and gas provider Just Energy Group Inc (JE.V) firmed 3.4% after saying on Thursday it expects to recover about $147.5 million in costs related to a deep freeze in the state in February. read more New data from Statistics Canada showed that the ratio of Canadian household debt-to-income rose to 177.3% in the third quarter from a revised 175.6% in the second quarter. read more The Bank of Canada will leave its inflation target at 2% in a framework renewal, shunning a major shift in policy similar to the one adopted by the U.S. Fed last year, a source said Thursday. read more Reporting by Anisha Sircar in Bengaluru; Editing by Shailesh Kuber

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