S&P/TSX composite steps higher Wednesday, U.S. stock markets mixed after rate hike
Canada’s main stock index posted anemic gains Wednesday as a rise in battery metals, industrials and health care balanced out weakness in technology stocks, while U.S. markets were mixed after another central bank rate hike.
The Federal Reserve hiked its key interest rate for an 11th time by a quarter of a percentage point Wednesday, echoing the Bank of Canada’s move earlier in July as central banks continue their fight against inflation.
The S&P/TSX composite index closed up 10.11 points at 20,561.64.
In New York, the Dow Jones industrial average was up 82.05 points at 35,520.12. The S&P 500 index was down 0.71 points at 4,566.75,while the Nasdaq composite was down 17.27 points at 14,127.28.
The hike wasn’t a surprise to the market, which hasn’t reacted significantly to it or to remarks made by officials after the announcement, said Ryan Crowther, vice-president and portfolio manager at Franklin Templeton Canada.
The Fed acknowledged some progress in labour markets and wage growth, and is not signalling another rate hike at this time, said Crowther.
“But the door is still very much open for a further hike in September or later this year,” he said.
“At this point, it’s clear that monetary policy change, even when it’s applied sharply over a short time, it takes longer than many people would think to produce the outcomes that they’re looking for. So I think they’re … still waiting, and going to be watching.”
Earnings for the second quarter continued to roll in, with some weakness in industrials and strong reports in big tech names, said Crowther. Expectations have been low for earnings broadly speaking, but much higher for the large tech stocks that have fuelled the market’s rally so far this year, he said.
“Between
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