Key Points
- Canada’s S&P/TSX Composite index hit a new record high on Tuesday.
- Gains led the rally in the energy and materials sectors.
- Crude oil prices rose on concerns about supply disruptions in Iran. Gold and silver both hit record highs, boosting mining stocks.
- U.S. inflation data came in as expected, reinforcing bets of a Fed rate hold.
Canada’s main stock index, the S&P/TSX Composite, touched a new record high on Tuesday, driven by a strong performance from energy and mining companies. At 11:45 AM EST, the index edged up 0.15% to 32,925.07 points, after briefly hitting an intraday record of 32,978.58 earlier in the session.
The energy sector was the day’s biggest winner, gaining 2% as crude oil prices rose. Investors are concerned about potential supply disruptions from Iran, which outweigh the prospect of additional oil from Venezuela. Oil producer Cenovus Energy was one of the top gainers, with its stock rising about 4%.
The materials sector, which includes mining companies, also had a great day, jumping 1.2% to a new peak. Both gold and silver hit record highs, boosting shares of precious metal miners such as SSR Mining, which also rose about 4%.
However, the gains in energy and materials were partially offset by losses in other sectors. Industrials fell 0.9%, and financial stocks lost 0.3%, keeping the overall index from climbing further.
Investors were also closely monitoring U.S. inflation data, which came in as expected. This has reinforced the belief that the U.S. Federal Reserve will keep interest rates unchanged for now, but it also leaves the door open for rate cuts later in the year.
In Canada, traders expect the central bank to leave rates unchanged at its next meeting. Meanwhile, Prime Minister Mark Carney is heading to China this week, the first visit by a Canadian leader in years, as the country looks to diversify its trade away from the United States.
