TORONTO 鈥� sa国际传媒's main stock index eked out a gain Tuesday as strength in energy and base metals helped offset softness across the rest of the market, while U.S. markets also rose.聽
The S&P/TSX composite index closed up 4.11 points at 20,036.77.
In New York, the Dow Jones industrial average was up 83.51 points at 35,416.98. The S&P 500 index was up 4.46 points at 4,554.89,while the Nasdaq composite was up 40.73 points at 14,281.76.
The financial subgroup was a big drag on the broader index.聽
Shares in Scotiabank closed more than four per cent lower Tuesday after it reported lower earnings for its fourth quarter, weighed down by higher loan loss provisions.
The results reflected the Canadian consumer鈥檚 increasing sensitivity to the higher interest rate environment, said Philip Petursson, chief investment strategist at IG Wealth Management.
鈥淗igher rates are weighing on the consumer, in particular households that have mortgages coming up for renewal,鈥� he said.
The rest of the biggest Canadian banks are set to report earnings later this week.
鈥淚 think Scotia will not be the only bank to increase loan loss provisions,鈥� Petursson said.聽
He said he thinks sa国际传媒 is currently in a mild recession centred around the consumer and the housing market as higher interest rates increase mortgage costs.聽
鈥淭he bank earnings are likely to reflect that.鈥澛�
On Thursday, Statistics sa国际传媒 will report GDP figures for September and the third quarter. The agency鈥檚 preliminary estimate released last month suggested the economy shrank at an annualized rate of 0.1 per cent in the third quarter
With the second quarter coming in negative for the Canadian economy, if the third quarter also saw a contraction, it will mark a technical recession 鈥� a notable difference from the continued growth the U.S. economy has been posting.聽
The U.S. Conference Board鈥檚 November survey on consumer confidence released Tuesday came in stronger than analysts expected.
The American consumer has proven more resilient than the Canadian one, said Petursson.
鈥淭he Canadian consumer feels the increase in interest rates far faster than in the United States, because of the nature of our mortgage market,鈥� he explained.聽
Because of that, Petursson expects the Bank of sa国际传媒 will cut rates in 2024, earlier than the U.S. Federal Reserve.
鈥淚 don't think the Fed is going to be in any hurry to cut interest rates, given the strength of the U.S. economy,鈥� he said.聽
鈥渟a国际传媒 raised first, sa国际传媒鈥檚 going to cut first.鈥�
The Canadian dollar traded for 73.63 cents US compared with 73.34 cents US on Monday.
The January crude oil contract was up US$1.55 at US$76.41 per barreland the January natural gas contract was down 11 cents at US$2.84 per mmBTU.
The February gold contract was up US$27.20 at US$2,060.20 an ounce and the March copper contract was up four cents at US$3.84 a pound.
鈥� With files from The Associated Press
This report by The Canadian Press was first published Nov. 28, 2023.
Companies in this story: (TSX:GSPTSE, TSX:CADUSD)聽
Rosa Saba, The Canadian Press
