The Canadian market showed modest gains on Tuesday, buoyed by an unexpected drop in the country's headline inflation. However, investor sentiment remained apprehensive throughout the trading session, with all eyes focused on the impending monetary policy decision from the Federal Reserve on Wednesday.
The benchmark S&P/TSX Composite Index closed up by 23.40 points, or 0.11%, at 21,860.58. Though the index dipped below the break-even line to 21,832.73 late in the morning, it reached a session high of 21,931.38.
Data released by Statistics Canada revealed that the consumer price index climbed 2.8% year-on-year, below the 2.9% increase observed in January and contrary to economists' predictions of a 3.1% rise. On a seasonally adjusted monthly basis, consumer prices rose by 0.1%, in contrast to a 0.1% decrease in the previous month. The core CPI, which excludes food and energy, remained stable at 0.1%.
The unexpected fall in headline inflation has sparked speculation that the Canadian central bank may contemplate rate cuts in the near future.
Gildan Activewear saw a nearly 11% surge in its shares. The company announced that, subsequent to a thorough review by a specially constituted committee following a confidential acquisition offer, the board had decided to put the company on the market.
West Fraser Timber registered almost a 3.25% increase. Other companies such as Morguard Corporation, Bombardier Inc, Canadian Tire Corporation, TFI International, Precision Drilling Corporation, Toromont Industries, RB Global, and CGI Inc saw gains ranging between 1.5 to 3%.
Shares of Constellation Software and Colliers International finished higher by 1.3% and 1%, respectively. However, Celestica Inc saw an approximately 3.5% fall. Newmont Corporation, Canadian Pacific Kansas City, Franco-Nevada Corporation and Teck Resources experienced drops between 1.6 to 2.25%.
