Canada’s main stock index on Tuesday extended its rebound from a three-month low, helped by gains for technology and consumer discretionary shares as domestic data showed inflation pressures easing.
The Toronto Stock Exchange’s S&P/TSX composite index (.GSPTSE), ended up 145.77 points, or 0.7%, at 19,733.09, adding to its gains on Monday. On Friday, the TSX posted its lowest close since mid-March.
Canada’s annual inflation rate came in at 3.4% in May, its slowest pace in two years, weakening the case for another interest rate hike as soon as next month by the Bank of Canada.
The technology sector advanced 1.6%, tracking gains for U.S. tech shares, while consumer discretionary was up 1.8%.
Shares of Brookfield Corp (BN.TO), rose 2.7% as its reinsurance arm offered to buy U.S. annuities provider American Equity Investment Life Holding (AEL.N), in a deal worth nearly $4.3 billion.
Still, the Toronto market is on track to post a quarterly decline, following two straight quarters of gains as an uncertain outlook for the global economy pressures commodity prices. Resource shares account for about 30% of the TSX’s market capitalization.
On Tuesday, the TSX energy index fell 0.3% as oil settled 2.4% lower at $67.70 a barrel.
“It’s going to take a lot to change the minds of energy traders,” Edward Moya, senior market analyst at OANDA, said in a note. “Fears of a weaker global growth outlook are not going away anytime soon.”
