The S&P/TSX Composite Index increased by 0.4%, reaching a new high at 29,179 on Wednesday. This rise followed a US Producer Price Index report that was softer than anticipated, reinforcing expectations that the Federal Reserve might have the leeway to reduce interest rates in the upcoming week and later this year. This suggests that the price pressures stemming from tariffs have not fully taken effect, thereby allowing policymakers more flexibility to ease monetary policy as the labor market shows signs of cooling.
Energy companies continued their upward trend, with Canadian Natural Resources, Suncor, Imperial Oil, and Cenovus registering gains between 1% and 4.9%. This rally was fueled by rising oil prices due to concerns over supply disruptions in Eastern Europe and the Middle East, combined with forecasts of increased demand from the United States. Moreover, major mining companies experienced gains, as the decreased opportunity cost of holding bullion bolstered gold prices. Additionally, technology heavyweights added to the upward momentum, as the sector, known for its sensitivity to interest rates, benefited from the growing likelihood of monetary easing across North America.
