TORONTO 鈥� sa国际传媒's main stock index gained more than 300 points or almost 1.5 per cent Wednesday on broad-based strength, while U.S. markets also rose to take back some of their losses from the previous day.聽
The indexes slid Tuesday after the latest report on U.S. inflation came in stronger than expected.
The S&P/TSX composite index closed up 304.43 points at 20,889.40.
In New York, the Dow Jones industrial average was up 151.52 points at 38,424.27. The S&P 500 index was up 47.45 points at 5,000.62, regaining its new spot above the 5,000 mark, while the Nasdaq composite was up 203.55 points at 15,859.15.
鈥淢arkets are taking more time to digest the inflation data that we saw yesterday ... and what it may or may not mean for (interest rate) cuts,鈥� said Macan Nia, co-chief investment strategist at Manulife Investment Management.聽
Expectations on lower interest rate have changed since the beginning of the year, with calls for cuts in March essentially off the table in both sa国际传媒 and the U.S.聽
With inflation still above target, the last couple of days have made investors reset their expectations, said Nia.聽
鈥淎 rate cut this early in the year is very unlikely.鈥澛�
He thinks cuts will start in the summer, but they will be very gradual.聽
Markets are now in a better position for the rest of the year, as they鈥檙e less likely to be disappointed than they were before when expectations for cuts in 2024 were almost double what the U.S. Federal Reserve had forecast, said Nia.
鈥淚 think we鈥檝e just given back some of that optimism over the last couple of days,鈥� he said.聽
U.S. markets are still having a strong start to the year despite Tuesday鈥檚 losses, noted Nia, while the TSX is essentially flat as the Canadian economy has softened more than its neighbour to the south.聽
The TSX posted stronger gains than U.S. markets on Wednesday as financials and industrials, two sectors heavily weighted north of the border, led gains in both countries, said Nia.聽
The Canadian dollar traded for 73.80 cents US compared with 73.77 cents US on Tuesday.
The March crude oil contract was down US$1.23 cents at US$76.64 per barrel and the March natural gas contract was down eight cents at US$1.61 per mmBTU.
The April gold contract was down US$2.90 at US$2,004.30 an ounce and the March copper contract was down a penny at US$3.70 a pound.
This report by The Canadian Press was first published Feb. 14, 2024.
Companies in this story: (TSX:GSPTSE, TSX:CADUSD)
Rosa Saba, The Canadian Press
