Economic news

TSX Muted as Waning Global Rate Cut Bets Outweigh Favourable Canada CPI

  • TSX down 0.1%
  • Technology shares led declines
  • Canadian inflation cooled to 2.9% in January

Feb 20 (Reuters) - Canada's main stock index remained subdued on Tuesday as headwinds from receding early rate cut expectations globally outweighed the boost from lower-than-expected domestic inflation data.

At 10:14 a.m. ET (1514 GMT), the Toronto Stock Exchange's S&P/TSX composite index was down 13.69 points, or 0.06%, at 21,241.92.

Wall Street's main indexes opened lower on Tuesday as dwindling hopes for early interest rate cuts weighed on investor sentiment despite upbeat results from retail giant Walmart.

"Market sentiment today might be more swayed by global factors. We are looking at concerns that US inflation still remains strong and bond yields have marked higher in the last couple weeks", said Doug Porter, chief economist at BMO Capital Markets.

Canada's annual inflation rate cooled more than expected to 2.9% in January while core inflation measures dropped to their lowest levels in more than two years, data showed on Tuesday.

"The headline CPI is likely to continue to ease lower because gasoline prices have fallen in January. But the BoC has recently emphasized the role shelter prices have played in propping up inflation, thus preventing a more "dovish" disposition by the BoC", analysts at Macquarie said in a note.

Rate-sensitive technology stocks declined 1.7%, led by declines in crypto miner Hut 8 that lost 7.8% the highest amongst the IT stocks.

Consumer discretionary and healthcare shares also fell 0.5% and 0.7%, respectively.

Losses were capped by 1% rise in consumer staples shares, with Loblaw gaining 1.2% after it expected to invest more than C$2 billion ($1.48 billion) this year to create more than 7,500 jobs.

In corporate news, gold miner SSRM Mining sank to the bottom of the index with an 8.0% decline after the company said on Sunday that its environmental permit for Copler gold mine was revoked.

Canadian pot firm Aurora Cannabis slid 3.3% after it appointed Simona King, a former executive of Bristol Myers-Squibb, as its Chief Financial Officer.

Reporting by Purvi Agarwal in Bengaluru; Editing by Ravi Prakash Kumar

Source: Reuters

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