TORONTO — Canada’s main stock index was up more than 400 points after a tumble right out of the gate, while U.S. stock markets also recovered significantly from the dip.
The S&P/TSX composite index was up 407.35 points or 2.4 per cent at 18,613.63, rebounding after dropping more than 300 points when the market opened.
Michael Currie, senior investment adviser at TD Wealth, said today’s market whipsawed on the much-anticipated inflation data coming out of the U.S., which beat expectations — in a bad way.
“We had hotter than expected U.S. inflation numbers, which nobody wants to see. They beat all the economists’ expectations.”
Inflation accelerated in the U.S., with consumer prices up 6.6 per cent in September year over year, excluding volatile food and energy costs.
In New York, the Dow Jones industrial average was up 827.34 points or 2.8 per cent at 30,038.19. The S&P 500 index was up 92.88 points or 2.6 per cent at 3,669.91, while the Nasdaq composite was up 232.05 points or 2.2 per cent at 10,649.15.
“Pretty much everything on the screen is green. And so anybody who jumped on the bandwagon this morning and started dumping on the news, there’s really a lot of pain right now,” said Currie.
It could be that investors are doing some bargain-hunting on the news that the market has reached new yearly lows, he speculated.
“Hopefully the market is finding a bottom here,” he said.
However, the gains posted Thursday could easily be undone in the next few sessions, much like what happened at the beginning of October, said Currie.
“When you do see moves this aggressive, either up or down, they’re usually not sustainable,” he said.
It’s clear that a pivot on interest rate hikes is now out of the question for the Fed and the Bank of Canada, said Currie.
“Black and white, the news was negative today. It’s not what we wanted,” he said.
The Canadian dollar traded for 72.43 cents UScompared with 72.45 cents US on Wednesday.
The November crude contract was up $1.84 at US$89.11 per barrel and the November natural gas contract was up 30.6 cents at US$6.74 per mmBTU.
Oil went up Thursday for the first time in four sessions, noted Currie, likely because of Energy Information Administration data showing a decline of almost five million barrels in distillate supplies, prompting worries about supply heading into the winter.
The December gold contract was down 50 cents at US$1,677 an ounce and the December copper contract was up 1.6 cents at US$3.44 a pound.
— With files from The Associated Press
This report by The Canadian Press was first published Oct. 13, 2022.
Companies in this story: (TSX:GSPTSE, TSX_CADUSD=X)
