S&P/TSX composite unchanged Wednesday, U.S. markets slightly up

TORONTO – Broad-based strength helped Canada’s main stock index buoy against losses in the energy sector on Wednesday, while US markets rose, particularly the Nasdaq, which rose two percent. The S&P/TSX composite index fell 16.

TORONTO – Broad-based strength helped Canada’s main stock index buoy against losses in the energy sector on Wednesday, while US markets rose, particularly the Nasdaq, which rose two percent.

The S&P/TSX composite index fell 16.33 points to 20,751.05.

In New York, the Dow Jones Industrial Average rose 6.92 points to 34,092.96. The S&P 500 index rose 42.61 points to 4,119.21, while the Nasdaq Composite rose 231.77 points to 11,816.32.

Markets have been quite resilient this week, said Ian Chong, associate portfolio manager at First Avenue Investment Counsel Inc.

Markets slowly sold off throughout the day as they anticipated the upcoming US Federal Reserve interest rate announcement.

When the rate hike came in as expected by a quarter of a point, markets retreated somewhat, reacting to the central bank’s hawkish message implying that more than one rate hike could be on the horizon, Chong said.

But after Federal Reserve Chair Jerome Powell gave a speech suggesting that the central bank would take future interest rate decisions from meeting to meeting, markets rallied for the rest of the day, likely marking some relief said Chong.

“It sounds a lot more balanced this time,” Chong said.

While it’s clear the central bank isn’t ready to pause or pivot just yet, Chong said markets are likely to have rallied on relief that the bank hasn’t doubled down on its hawkish tone.

Meanwhile, oil prices were down on Wednesday and the energy index on the TSX fell 2.8 percent. Much of those losses came from TC Energy, Chong said, which fell 5.6 percent on news that the Coastal Gaslink project will cost more than expected to complete.

As earnings continue to climb this week and big tech names like Apple and Alphabet are set to report earnings, Chong said markets could reverse some of the week’s gains.

Overall earnings weren’t as bad as some expected, but some of the outlook was weak, Chong said.

The Canadian dollar was trading at 75.07 US cents on Tuesday, compared to 74.91 US cents.

The March crude oil contract fell $2.46 to $76.41 a barrel and the March natural gas contract fell 22 cents to $2.47 a mmBTU.

The April gold contract fell $2.50 to $1,942.80 an ounce and the March copper contract fell 12 cents to $4.11 a pound.

This report from The Canadian Press was first published on February 1, 2023.

Company in this story: (TSX:GSPTSE, TSX:CADUSD=X)

Rosa Saba, The Canadian Press