By Fergal Smith
TORONTO – Canada’s main stock index rose on Tuesday to its highest level in over three weeks as gains for financial and industrial shares offset a decline in the energy group.
The Toronto Stock Exchange’s S&P/TSX composite index ended up 141.68 points, or 0.7%, at 21,377.18, its highest closing level since Jan. 17.
Financial shares, which account for about one-third of the Toronto market, were up 1.2% as bond yields climbed. Higher interest rates tend to raise the margins that banks can earn on their loans.
Bank of Canada Governor Tiff Macklem is due to speak on Wednesday on the evolution of Canadian business, which could offer clues on the interest rate outlook.
Money markets expect the Canadian central bank to begin hiking rates at its next policy announcement on March 2 and to raise borrowing costs a total of six times this year.
Industrials added 1.5%, while the materials group, which includes precious and base metals miners and fertilizer companies, ended 2.0% higher, helped by higher gold prices.
“Markets have held up reasonably well considering crude oil is a bit off today,” said Colin Cieszynski, chief market strategist at SIA Wealth Management.
U.S. crude oil futures settled 2.2% lower at $89.36 a barrel as investors worried the resumption of indirect talks between the United States and Iran lead to more oil exports from the OPEC producer.
The slide in oil weighed on energy stocks, which ended 3.9% lower. It included a 6.4% decline in the shares of Cenovus Energy Inc after the company reported a quarterly loss.
(Reporting by Fergal Smith; Additional reporting by Anisha Sircar in Bengaluru; Editing by Sandra Maler)
