Canadian Western Bank rises after profit beat
Miners, energy gain on higher commodity prices
TSX up 0.8%
(Updated at 9:43 a.m. ET/ 1343 GMT)
By Shashwat Chauhan
Sept 1 (Reuters) – Canada’s main index touched a one-month high on Friday, helped by gains in energy and mining stocks, while investor sentiment remained upbeat as more global economic data indicated that interest rate hikes may be nearing their end.
At 9:43 a.m. ET (1343 GMT), the Toronto Stock Exchange’s S&P/TSX composite index was up 157.4 points, or 0.78%, at 20,450.02. It is on track to gain more than 2% for the week.
Energy stocks added 1.7% as crude prices rose on tightening supplies and expectations that the OPEC+ group of oil producers would extend output cuts to the end of the year.
The materials sector gained 0.9% as precious metal prices rose, while most base metals rallied after a private sector survey showed China’s factory activity surprisingly returned to expansion in August.
Meanwhile, official data showed Canada’s economy unexpectedly contracted in the second quarter at an annualized rate of 0.2%, while real GDP was most likely unchanged in July.
“I’m not surprised that the Canadian economy contracted,” said Matt Manara, partner and portfolio manager at Avenue Investment Management.
“(The BoC) will pause and the rate hikes are done… into some point next year, the narrative will quickly turn into that we should be cutting rates.”
Traders are nearly fully pricing in that the Bank of Canada (BoC) would hold rates steady when it meets next week.
A separate reading showed contraction in Canada’s manufacturing sector gathered pace in August.
Wall Street, too, had an upbeat start after data showed a rise in the U.S. unemployment rate and moderation in wage growth pointed to easing labor market conditions.
Canadian Western Bank advanced 9.9%, becoming the top percentage gainer on the TSX, after the lender beat third-quarter profit estimates.
(Reporting by Shashwat Chauhan in Bengaluru; Editing by Shilpi Majumdar)