Canada's stock index creeps up, tech companies follow gains
Business
Good employment, inflation still well above 6% allowing BoC ammo to hike one more time, Allan Small
(Reuters) - As investors anticipated the Bank of Canada s interest rate announcement later this week, Canada s main stock index crept up on Monday as technology companies followed gains in their Wall Street counterparts.
The S&P/TSX composite index of the Toronto Stock Exchange was up 25.58 points, or 0.12%, at 20,528.79 at 10:09 a.m. ET (1509 GMT). The largest gainers were technology equities, up 1.6%, supported by a 6.2% increase in Shopify after Deutsche Bank upgraded the company from "hold" to "buy."
The Bank of Canada (BoC) was under the spotlight before to its interest rate announcement on Wednesday, with the majority of investors favouring a 25-basis-point increase.
According to Allan Small, senior financial adviser at Allan Small Financial Group, "the most recent employment report still indicates good employment and that inflation, while decreasing, is still well above 6%, allowing the Bank of Canada ammo to hike (rates) one more time."
In an effort to rein in spiralling inflation, the Canadian central bank was one of the first central banks in the world to start raising its overnight lending rate last year.
The BoC said on Sunday that it will release the minutes from its policy-setting meeting this week for the first time in its history, a move that some experts claim could help it regain confidence that it lost last year due to skyrocketing inflation and promote unconventional thinking.
Data released last week revealed that lower gas prices in December caused Canada s annual inflation rate to decline more than anticipated.
BCE Inc. lost 0.9% following a downgrade by TD Securities, while communication companies as a whole lost 0.4%, significantly dragging down the index.
Ritchie Bros Auctioneers increased 2.6% after announcing that it will boost the cash compensation for its acquisition of IAA Inc., a firm located in the United States.
