By Fergal Smith
TORONTO (Reuters) – Canada’s main stock index rose on Monday to its highest closing level in nearly four weeks as investors snapped up stocks in some of the most depressed sectors of the market amid hopes that central banks would ease the pace of interest rate hikes.
The Toronto Stock Exchange’s S&P/TSX composite index ended up 42.56 points, or 0.2%, at 19,857.07, its highest closing level since Dec. 14.
“Market moves on a day-to-day basis are very much being dictated by the inflation picture and central bank actions. That has not changed (from 2022),” said Elvis Picardo, portfolio manager at Luft Financial, iA Private Wealth.
The U.S. benchmark S&P 500 index closed barely changed as expectations that the Federal Reserve will become less aggressive with its interest rate hikes were offset by lingering worries about inflation.
“It does seem like, even though market participants are braced for a recession, the tone, at least for the first few days of this year, has been encouraging,” Picardo said. “We are seeing some buying come back into the beaten-down groups like technology.”
The Toronto market’s technology sector lost 35.7% in 2022. It was up nearly 1% on Monday, while energy gained 0.6% as oil settled 1.2% higher at $74.63 a barrel. Oil rose after China reopened its borders, boosting the outlook for fuel demand.
A standout among individual names was financial services firm Canaccord Genuity Group Inc. Its shares soared 29.5% after a group led by the company’s management said it would launch a takeover bid at nearly C$1.13 billion ($845 million).
Cannabis producer Tilray Brands Inc was one of the laggards. Its shares fell 8.1% after the company reported a second-quarter loss.
(Reporting by Fergal Smith; Additional reporting by Shristi Achar A and Johann M Cherian; Editing by Will Dunham)
