Futures tracking Canada’s stock market advanced on Thursday, supported by gains in commodity producers. Gold prices rose, bolstering mining shares, while oil also moved higher amid ongoing strikes in the Middle East. The strength in energy producers contrasted with weakness in credit-sensitive sectors, including financials, as renewed inflationary pressures weighed on those areas.
The Bank of Canada left its key interest rate unchanged on Wednesday, but Governor Tiff Macklem signaled that policymakers are ready to deliver multiple additional hikes if inflation remains elevated. At the same time, rising global bond yields have pressured equities this week, as investors reassessed the interest-rate outlook against a backdrop of escalating tensions in the Middle East.
In corporate news, BRP’s (DOO) second-quarter revenue exceeded analysts’ estimates. On the trade front, Canada’s merchandise trade surplus with the rest of the world narrowed sharply, falling to C$769 million in July from C$4.2 billion in June, amid a recent escalation in the US–Canada trade dispute.
