Toronto index rises slightly after a bruising week

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Canada’s main stock index rose on Monday after last week’s rout, helped by gains in cyclical and financial stocks, although trading volumes remained weak with US markets closed for a holiday.

As of 9:39 a.m. ET (1339 GMT), the Toronto Stock Exchange‘s S&P/TSX Composite Index was up 111.6 points, or 0.59%, at 19,042.08.

On Monday, global equities also posted modest gains, with US markets closed for June 16, National Independence Day.

The financials sector gained 0.5%, while consumer discretionary stocks rose 1.23%.

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“Investors sold riskier assets on Friday amid recession fears, triggering a significant decline. On Monday, however, the Canadian market is expected to rally slightly as global equities post modest gains,” said Kunal Sawhney, CEO of Kalkine. Group.

“But given that US markets will remain closed due to June 19, we may not see massive trading activity in Canada.”

The index was recovering after a sharp sell-off last week, where it posted its biggest weekly drop since March 2020, on fears that aggressive interest rate hikes by major central banks could trigger a recession.

Investors are now awaiting national inflation figures due Wednesday and they will present a clear picture of the economic situation in Canada, Sawhney said.

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Analysts say the risk of inflation taking root in the Canadian economy is growing as soaring prices for gasoline and other highly visible consumer goods undermine the Bank of Canada’s efforts to contain expectations price increase.

The Materials sector, which includes precious and base metal mines and fertilizer companies, added 0.3%, while the heavyweight Energy sector climbed 1.3%.

In company news, shares of Fairfax Financial Holdings gained 1.0% after announcing it would sell its global pet insurance operations to JAB Holding, the family’s private investment company. German company Reimann in a $1.4 billion deal. (Reporting by Amal S in Bangalore Editing by Bernadette Baum)



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