TORONTO — Strength in base metal stocks helped lift Canada's main stock index Tuesday, while U.S. stock markets were mixed.
Markets took on a cautious tone Tuesday, said Greg Taylor, chief investment officer at Purpose Investments.
“We had a super strong month of November across the board, and then yesterday was kind of a bit of a give back,” he said, noting that weakness in commodities held the TSX back on Monday.
The S&P/TSX composite index closed up 45.40 points on Tuesday at 25,635.73.
In New York, the Dow Jones industrial average was down 76.47 points at 44,705.53. The S&P 500 index was up 2.73 points at 6,049.88, while the Nasdaq composite was up 76.96 points at 19,480.91.
In Canada, Scotiabank was the first major bank to report earnings, with the rest to come in short order as the sector caps off earnings season.
The bank saw its earnings rise year-over-year, and it set aside a smaller sum for loan losses than it did a year ago. However, its profit came in below analyst expectations, and Scotiabank said it expects continued pressure on loan growth in the coming months.
Scotiabank’s share price fell more than three per cent, but Taylor said that was likely investors taking some profit after a strong several months for the stock.
“There’s not a lot of expectations for any fireworks from the banks this week,” he said.
In the U.S., a report showed U.S. employers advertised slightly more job openings at the end of October than they did the month before, ahead of the monthly jobs report at the end of the week.
The U.S. Federal Reserve is set to make its last interest rate decision of the year later this month.
“The payroll number Friday is going to be interesting to watch,” said Taylor.
“It's certainly a case that if you did get a really strong number, you might get some people putting into question the need for another rate cut at this meeting.”
But while economic strength and the promised policies of president-elect Donald Trump could mean fewer rate cuts than previously expected in 2025, Taylor said a cut from the Fed later this month is a “foregone conclusion.”
In Canada, where the economy hasn’t weathered high rates as well, another cut is expected next week from the central bank, said Taylor.
However, if the Fed does pull back on cuts in the coming year, Canada may have to move with more caution, he said, as the divergence could put further downward pressure on the loonie.
The Canadian dollar traded for 71.14 cents US, compared with 71.14 cents US on Monday.
The January crude oil contract was up US$1.84 at US$69.94 per barrel and the January natural gas contract was down 17 cents at US$3.04 per mmBTU.
The February gold contract was up US$9.40 at US$2,667.90 an ounce and the March copper contract was up 13 cents at US$4.20 a pound.
— With files from The Associated Press
This report by The Canadian Press was first published Dec. 3, 2024.
Companies in this story: (TSX:GSPTSE, TSX:CADUSD)
Rosa Saba, The Canadian Press