TSX climbs as energy firms gain, U.S CPI awaited

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Canada’s main stock index gained on Wednesday as energy stocks rose, while investors awaited U.S inflation data due this week to provide clues on the Federal Reserve’s rate hike trajectory.

At 1030 a.m. ET (1530 GMT), the Toronto Stock Exchange’s S&P/TSX composite index was up 60.67 points, or 0.3%, at 19,959.53.

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Canadian stocks have gained 2.3% since the start of this year as markets rallied on signs of softening U.S. wage inflation.

Investors now have their eyes on U.S CPI data, which will set the tone for the Fed’s monetary policy outlook.

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“The jobs data came out pretty strong (both in the U.S. and Canada), yet we saw that wages weren’t growing nearly as they were earlier. Which is why tomorrow is going to be a very key data point,” said Allan Small, senior investment advisor at Allan Small Financial Group.

“That is going to tell us if indeed everything we’re seeing is finally playing into the actual inflation data itself.”

The benchmark index fell 8.4% in 2022 as interest rate hikes by central banks across the world pressured equity markets.

The Bank of Canada had lifted rates at a record pace of 400 basis points in nine months in 2022 to 4.25% – a level last seen in January 2008.

The energy sector boosted the commodity-heavy index as National Bank of Canada raised its price target on major oil companies including Vermilion Energy and Cenovus Energy Inc, as it sees an upside in crude prices.

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Gold miners dipped 1.1%, dragged by a fall in shares of Equinox Gold Corp as the gold miner posted full-year production below the lower end of guidance due to operational challenges earlier in the year.

Barrick Gold Corp signed new joint venture deals with Saudi Arabian Mining Co (Ma’aden). The shares fell 1.5%, tracking losses in the broader sector.

The Panama government doubled down on its order that First Quantum Minerals should halt operations at its flagship local copper mine, since it had been operating without a contract since 2017. Shares of the metal miner fell 2.7%. (Reporting by Shristi Achar A and Johann M Cherian in Bengaluru; Editing by Krishna Chandra Eluri)