TORONTO 鈥� Canada's main stock index slipped Wednesday as October inflation data was released, pulled lower by losses in energy and metals, while U.S. markets were also down.聽
The S&P/TSX composite index closed down 36.82 points at 19,957.96.
In New York, the Dow Jones industrial average was down 39.09 points at 33,553.83.The S&P 500 index was down 32.94 points at 3,958.79, while the Nasdaq composite was down 174.75 points at 11,183.66.
Canada鈥檚 inflation data was right in line with expectations, said Greg Taylor, chief investment officer at Purpose Investments, with the annual inflation rate for October holding steady at 6.9 per cent.聽
鈥淐ertainly this isn't going to do anything to change the Bank of Canada鈥檚 expected path鈥� of interest rate hikes, said Taylor.聽
That鈥檚 in contrast to U.S. inflation data last week which was lower than expected, causing markets to spike.
鈥淩eally the market is more focused on what's going on with the ... U.S. economic data, and we've gotten some pretty positive results in the last few weeks. And that's resulted in a massive bounce off the lows,鈥� said Taylor.
鈥淎nd I think the big thing for markets is just figuring out if this bounce has more legs, or if it's going to pause around these levels.鈥�
Markets in the U.S. are staying afloat despite some disappointing news, as Target reported declining profits and had a rather grim outlook for the coming quarter. Meanwhile, semiconductor company Micron Technology Inc. also had a gloomy outlook, cutting its supply forecast and likely contributing to the Nasdaq being down by more than the other indexes, said Taylor.聽
The Canadian dollar traded for 75.13 cents US compared with 75.24 cents US on Tuesday.
The December crude oil contract was down US$1.33 at US$85.59 per barrel and the December natural gas contract was up 17 cents at US$6.20 per mmBTU.
The fact that oil continues to hang around $85 is a 鈥渕assive win,鈥� said Taylor. 鈥淚鈥檓 not that concerned about it.鈥澛�
As the third-quarter earnings season draws to a close, Taylor said the bigger picture is that traditional investment picks have been performing much better than some of the newer players.
鈥淎 lot of the companies that led in the last cycle, meaning really the tech stocks and the dot-coms, have really disappointed on earnings,鈥� he said.聽
鈥淏ut the more traditional companies, and the cyclicals and consumer and retailers and industrials, have actually done pretty well.鈥�
Investors can breathe easy after an exciting few weeks, as the next few should be quieter, said Taylor.
鈥淭he U.S. markets have had such a big bounce in the last week that I think it's probably due for some sort of pause,鈥� he said.聽
U.S. exchanges will be closed next Thursday for the Thanksgiving holiday, and close early on Friday.
鈥淭he next few weeks could be a nice, calm period for markets and probably will be welcomed by a lot of investors.鈥澛�
The December gold contract was down US$1.00 at US$1,775.80 an ounce and the December copper contract was down five cents at US$3.77 a pound.
This report by The Canadian Press was first published Nov. 16, 2022.
Companies in this story: (TSX:GSPTSE, TSX:CADUSD=X)
Rosa Saba, The Canadian Press
