CANADA STOCKS-TSX pauses ahead of rate decision from BoC, Fed
By Sanchayaita Roy
Sept 15 (Reuters) - Canada's main stock index was flat on Monday, as investors stayed cautious ahead of key policy decisions from both the Bank of Canada and the U.S. Federal Reserve.
The Toronto Stock Exchange's S&P/TSX composite index .GSPTSE was up 0.06% at 29,201.96 points.
Economists anticipate the BoC will cut its overnight rate by a quarter point on September 17, as the labour market deteriorates and economic activity weakens. They also expect one more cut in the next quarter.
Canada's central bank has faced growing pressure to resume easing after holding rates steady since March following a cumulative 225-basis-point reduction - one of the most aggressive among the country's G10 peers.
Meanwhile, the U.S. central bank's rate decision will take center stage, with investors largely expecting a 25-basis-point cut on Wednesday after a series of economic indicators pointed to a worsening jobs market in the world's biggest economy.
Investors are cautious before the two central banks' meetings, said Allan Small, senior investment adviser of the Allan Small Financial Group with iA Private Wealth.
"Markets price in well in advance what the Fed or Bank of Canada is more than likely to do and unless there's a surprise either way, you're probably going to see a muted response."
On Monday, the probability of a 25-basis-point interest rate cut by the Canadian central bank stood at 95.5%, according to data compiled by LSEG. 0#CADIRPR
"It's a pretty much a done deal," added Small.
Several other central banks will also announce their policy decisions this week, including those in the UK and Japan.
On the TSX, consumer staples stocks .GSPTTCS slipped 1.4%, while an index of communication stocks .GSPTTTS fell 1.2%.
Among individual stocks, B2Gold BTO.TO fell 3.5% after the Canadian miner provided an update on Goose Mine commissioning and confirmed its consolidated 2025 production guidance range.
Parex Resources PXT.TO posted the biggest percentage gain on the TSX, up 5.3%, after BMO upgraded the stock to "outperform" from "market perform".
Related Articles
September Global Central Bank Divergence: How Will U.S. Stocks and Forex Markets Move?
TradingKey - Despite the divergence in monetary policies among major global central banks in September (with the Federal Reserve cutting rates while the European Central Bank, Bank of England, and Bank of Japan maintain steady rates), we expect the policy directions of the Fed, ECB, and BoE to...
Duolingo (DUOL): Can the Green Bird Fly High Again
TradingKey - Duolingo is a great business, despite the stock price being down nearly 50% from its peak less than four months ago. However, the question is whether it’s worth buying it at a market cap of $12.5 billion. The answer is “not yet” because the traffic, even though healthy...
U.S. September Rate Decision Preview: What It Means for Bitcoin and Could It Spark a New Rally?
Bitcoin’s rally stalls ahead of the Fed meeting — has the bullish momentum already been priced in?
UK July GDP Commentary: Can GBP Break Through Its Current Fluctuation?
After considering multiple factors, given the evident weakness on both sides of this currency pair, we expect the GBP/USD exchange rate to maintain its current fluctuation trend in the short term.
Fed to Cut Rates: All Asset Prices Up!
TradingKey - The Federal Reserve is almost certain to restart its interest rate cut cycle on 17 September this year. After in-depth research, we have concluded that cryptocurrencies, the broader U.S. stock market, and short-term U.S. Treasury bonds will all go up.
