Canada’s main stock index rose on Thursday, with tech shares offsetting declines in gold and mining stocks, a day after the Bank of Canada and the U.S. Federal Reserve cut rates by a quarter-point and left the door open for further reduction.
Toronto’s S&P/TSX composite index gained 0.3% to 29,420.03 points by 10:00 ET in choppy early trading.
The BoC reduced its key policy rate to a three-year low of 2.5% in a unanimous decision, adding that it would be ready for further cuts if the economy needed them.
The Fed also expressed a dovish sentiment, projecting two more cuts for the year.
“Markets continue to ride the positive momentum after central banks showed that they are willing to respond to some economic softness and also cooling in the labor market,” said Angelo Kourkafas, senior investment strategist at Edward Jones.
“The TSX has been riding the gold wave and we have seen the biggest rally in gold since the 1970s. It will be important to see if there’s some pullback in gold, what impact it would have on the material sector.”
Gold miners and material stocks led the sectoral declines, tracking a drop in metal prices. Gold prices pulled back from a recent rally.
Miner Endeavour Silver Corp dropped 4.5%, while Seabridge Gold Orla Mining and G Mining were down between 2% and 3%.
Conversely, technology stocks rose 1.3% after weakness in the previous session.
Electronic equipment company Celestica added 1.1%, while heavyweights Shopify and Blackberry were up 2% and 3.3%, respectively.
Meanwhile, Canadian Prime Minister Mark Carney arrived in Mexico City on Thursday in an attempt to improve recently strained ties with Mexico and seek a common front ahead of trade talks with the U.S.
The crucial U.S.-Mexico-Canada free trade deal will be reviewed next year.
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