Wednesday, November 30

TSX inches higher despite surprise rise in producer prices

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Canada’s main stock index inchd higher on Friday after two straight days of losses, lifted by financial and industrial stocks, while investors looked past a surprise jump in producer prices in October.

Data showed producer prices in Canada rose more than expected to 2.4% on higher prices for refined petroleum products.

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At 10:20 am ET (1520 GMT), the Toronto Stock Exchange’s S&P/TSX composite index was up 31.53 points, or 0.16%, at 19,916.11.

The industrial and financial sector were top gainers, up 1.0% and 0.5% respectively.

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β€œAs we near the end of the year, the historical trend is what is called the Santa Claus rally,” said Brandon Michael, senior analyst at ABC Funds. β€œIt’s this period of strong seasonality where investors would want to be invested in the market .”

Inflation data has been mixed this week, with consumer inflation meeting expectations, while producer prices were hotter than expected. However, there were growing signs that US inflation was beginning to cool.

“There’s no doubt that we’re witnessing a peaking of inflation, but central banks do not look at only one number but at a string of data as a whole when deciding rate hikes,” Michael added.

Analysts are anticipating a 25-basis-point hike by the Bank of Canada in its Dec. 7 policy meeting.

Among stocks, Turquoise Hill Resources rose 1.3% after Rio Tinto Ltd said it would plow ahead with a $3.3 billion bid to buy the 49% of Turquoise it does not already own.

Wall Street’s main indexes edged higher after posting losses in the previous session following hawkish comments from a top Federal Reserve official. (Reporting by Johann M Cherian in Bengaluru; Editing by Shailesh Kuber)

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