Bank of Canada’s interest rate decision helps utilities and telecom sectors

TORONTO — Canada’s main stock index moved just slightly Wednesday after the Bank of Canada’s decision not to increase interest rates helped interest-sensitive sectors and weakened the loonie.

The S&P/TSX composite index closed up 5.53 points to 16,092.07 after hitting an intraday peak of 16,145.80, a high for the year.

The market was led by the utilities and telecommunications sectors, which each gained nearly one percentage point.

A benign interest rate environment in light of the central bank’s decision Wednesday is supportive for those sectors, says Anish Chopra, managing director with Portfolio Management Corp.

“If you’re an investor in utilities, those are safety areas which generally trade along with rates. So the fact that rates are going to stay stable is positive for utilities.”

The REITs sector also rose as is typically the case.

These sectors would be expected to decrease had the central bank unexpectedly increased rates.

The Canadian dollar decreased by nearly half a cent. It traded at an average of 74.52 compared with an average of 74.93 cents US on Tuesday.

The move was propelled by the interest rate path along with the weak economic environment that, in part, prompted the bank’s decision, said Chopra.

Seven of the 11 sectors of the TSX rose. Health care led on the downside, falling 1.9 per cent, followed by energy and materials.

The April crude contract was down 34 cents at US$56.22 per barrel and the April natural gas contract was down 4.3 cents at US$2.84 per mmBTU.

The price of West Texas Intermediate fell slightly as U.S. fuel stockpiles dropped during the week to offset an increase of 7.1 million barrels of crude inventories.

The April gold contract was up US$2.90 at US$1,287.60 an ounce and the May copper contract was down 1.5 cents at US$2.92 a pound.

“So those sectors are actually just following the underlying commodities that are related to them,” added Chopra.

In New York, the Dow Jones industrial average was down 133.17 points at 25,673.46. The S&P 500 index was down 18.20 points at 2,771.45, while the Nasdaq composite was down 70.44 points at 7,505.92.

The U.S. markets fell on a quiet day amid restlessness about a trade deal being reached with China.

“It’s just one of those quiet days where it’s a bit flat and there’s no real one driver doing anything.”

Index and currency in this story: (TSX:GSPTSE, TSX:CADUSD=X)

Just Posted

Intelligence official charged seemed to be ‘exemplar of discretion’: former colleague

A professor who once worked with an RCMP intelligence official charged with… Continue reading

More than 100 people participate in the Light the Night Walk in Red Deer

Red Deer’s Michael Wark was 27 when he was diagnosed with cancer.… Continue reading

‘Big bang’ precedes Red Deer house fire, says neighbour

A Red Deer home was heavily damaged by a fire early Friday… Continue reading

PHOTOS: Grilling meat at Shelter Ribfest in Red Deer

The first-ever Shelter Ribfest is on this weekend at Gary W. Harris… Continue reading

Red Deer man arrested, charged for drug-related offences

A Red Deer man is facing a number of charges, including possession… Continue reading

Fashion Fridays: 10 effortlessly stylish items for fall

Kim XO, helps to keep you looking good on Fashion Fridays on the Black Press Media Network

Your community calendar

Wednesday Central Alberta Historical Society annual general meeting is 6 p.m. at… Continue reading

UAW members on the job at GM plants after contract expires

DETROIT — The four-year contract between General Motors and the United Auto… Continue reading

Five things to watch for in the Canadian business world in the coming week

TORONTO — Five things to watch for in the Canadian business world… Continue reading

Police seeking multiple suspects in shooting that left 1 dead and 5 wounded

MISSISSAUGA, Ont. — A teenage boy is dead and five other people… Continue reading

Trump front and centre as talk of trade, jobs emerges on campaign trail

OTTAWA — A familiar U.S. face finally showed up front and centre… Continue reading

RDC Kings and Queens cross country dominate on home turf

There was a lot of pride floating around amongst the host team… Continue reading

Hunting Hills Lightning cruise past Foothills Falcons in high school football action

The Hunting Hills Lightning showed their Football Alberta ranking was no fluke… Continue reading

Two students dead, several seriously injured in Vancouver Island bus rollover

Two University of Victoria students died and several people were injured after… Continue reading

Most Read