TORONTO — Canada’s main stock index was largely unchanged Tuesday as small gains in energy helped outweigh softness in financials and industrials, while U.S. markets were mixed.
The S&P/TSX composite index was up 2.56 points at 20,704.79.
In New York, the Dow Jones industrial average was down 156.66 points at 34,089.27. The S&P 500 index was down 1.16 points at 4,136.13,while the Nasdaq composite was up 68.36 points at 11,960.15.
The inflation print out of the U.S. was the biggest news Tuesday, said Stephen Duench, vice-president and portfolio manager for AGF Investments Inc. In terms of the fight against inflation it’s perhaps the most important data point, he added.
Expectations for this month’s inflation print were for inflation to slow more gradually, as there were some new changes to how the data was calculated, giving a little more weight to factors that have seen more stubborn inflation like rent and services and a little less to things like energy, which tend to be tied more to global issues than economic policy, said Duench.
The inflation print, which saw inflation slow slightly to 6.4 per cent in January down from 6.5 per cent in December, more or less met those expectations, he said, and investors didn’t react dramatically in either direction.
“The market’s taking it in stride,” said Duench.
While year-over-year inflation slowed, prices were up 0.5 per cent between December and January, compared with a smaller rise of 0.1 per cent between November and December.
Expectations seem to be shifting toward both inflation and interest rates remaining higher for longer, he said, with investors starting to price out rate cuts later in the year.
Duench said Wednesday’s data on retail sales will give a new glimpse into how the consumer is faring amid stubborn inflation and a continuously hot labour market.
With each new release of data, cautious optimism about a potential soft landing in 2023 increases, he said.
The Canadian dollar traded for 74.93 cents UScompared with 74.95 cents US on Monday.
The March crude contract was down US$1.08 at US$79.06 per barrel and the March natural gas contract was up 16 cents at US$2.57 per mmBTU.
The April gold contract was up US$1.90 at US$1,865.40 an ounce and the March copper contract was up two cents at US$4.08 a pound.
This report by The Canadian Press was first published Feb. 14, 2023.
Companies in this story: (TSX:GSPTSE, TSX_CADUSD=X)
