Canada's main stock index opened lower on Tuesday, dragged down by rate-sensitive technology stocks after hotter-than-expected inflation data fanned fears that the Bank of Canada might raise interest rates further.
The TSX Composite Index resumed its downward trek, losing 131.38 points to open Tuesday’s session at 20,361.45
The Canadian dollar gained 0.47 cents at 74.61 cents U.S.
Canada's Trans Mountain oil pipeline expansion, which will nearly triple the flow of crude from Alberta to Canada's Pacific Coast, will shake up North America's supply by diverting barrels now mainly delivered to refiners and exporters in the U.S. Midwest and Gulf Coast.
Energy companies such as Imperial Oil and Suncor were in the spotlight Tuesday before the opening bell. Imperial shares lost three cents to $79.24, while those for Suncor galloped 27 cents to $47.33.
On the economic schedule, Statistics Canada said the Consumer Price Index (CPI) rose 4.0% on a year-over-year basis in August, following a 3.3% increase in July. On a seasonally adjusted monthly basis, the CPI rose 0.6% in August.
ON BAYSTREET
The TSX Venture Exchange skidded 1.56 points to 589.53.
All but one of the 12 TSX subgroups were lower in the first hour, with health-care stocks tailing 2.1%, information technology, off 1.8%, and gold, dulling in price 1%.
Only energy held out, eking ahead 0.04%.
ON WALLSTREET
Stocks retreated on Tuesday as Wall Street awaited the results of this week’s Federal Reserve policy meeting.
The Dow Jones Industrials dropped 171.04 points to 34,453.26.
The S&P 500 index sank 19.8 points to 4,433.73.
The NASDAQ index withered 80.25 points to 13,629.99.
Deere, often seen as a barometer of future economic activity, fell more than 2% in the session. The drop came after Evercore ISI downgraded the stock to in-line from outperform due to agricultural production cuts.
Leadership of striking United Auto Workers said more workers could be called on to withhold labor if progress is not made by a Friday deadline. Stellantis climbed about 2% in Tuesday’s session, while General Motors moved 0.8% forward, and Ford advanced around 0.1%.
The central bank’s two-day meeting begins on Tuesday. The Fed is not expected to raise rates when announcing its decision Wednesday, with traders pricing in a 99% probability that the central bank skips a hike. Traders are putting just a 29% chance of a hike in November.
The Fed will also offer economic forecasts on Wednesday. Investors will watch for commentary around the path of inflation and future path of interest rates.
Prices for the 10-year Treasury sagged, raising yields to 4.34% from Monday’s 4.31%. Treasury prices and yields move in opposite directions.
Oil prices strengthened $1.35 to $92.83 U.S. a barrel.
Gold prices eased 50 cents to $1,952.90 U.S. an ounce.
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