Hope for a rate cut | The TSX is up and US markets are mixed

(Toronto) Strong base metal values ​​contributed to the rise of Canada’s main stock index on Tuesday, while US stock markets were mixed.

Markets took a cautious stance on Tuesday, said Greg Taylor, chief investment officer at Purpose Investments.

“We had an extremely strong month of November across the board, and then yesterday [lundi]we experienced a bit of a comeback,” he noted, noting that commodity weakness held back the TSX on Monday.

Tuesday in Toronto, the S&P/TSX Composite Index closed up 45.40 points at 25,635.73.

In New York, the Dow Jones industrial average fell 76.47 points to 44,705.53. The S&P 500 index rose 2.73 points to 6,049.88, while the NASDAQ Composite Index rose 76.96 points to 19,480.91.

In Canada, Scotiabank was the first major bank to report its results, with others expected to follow shortly as the sector closes the earnings season.

The bank saw its profits rise year over year and set aside less for loan losses than a year ago. However, its profits fell short of analysts’ forecasts and Scotiabank said it expected continued pressure on loan growth in the coming months.

Scotiabank’s share price fell more than 3%, but Taylor noted that was likely because investors took a bit of profit after several months of strong activity in the stock. .

“There aren’t a lot of fireworks expectations from the banks this week,” he said.

In the United States, a report showed that American employers announced slightly more job openings in October than the previous month. A monthly employment report is due Friday.

The US Federal Reserve is due to make its final interest rate decision of the year later this month.

“The employment numbers on Friday are going to be interesting to watch,” said Mr. Taylor. To be sure, if the numbers were really good, some might question the need for another rate cut at this meeting. »

But if economic strength and policies promised by President-elect Donald Trump could mean fewer rate cuts than expected in 2025, Mr. Taylor said a Fed rate cut later this month was “a conclusion acquired”.

In Canada, where the economy has not held up as well to high interest rates, another cut is expected next week from the central bank, Mr. Taylor said.

However, if the Fed slows the pace of rate cuts in the coming year, Canada may need to proceed more cautiously, as the divergence could put additional downward pressure on the loonie, a- he noted.

On the currency market, the Canadian dollar traded at 71.14 US cents, unchanged from Monday.

On the New York Mercantile Exchange, the price of crude oil rose US$1.84 to US$69.94 per barrel and natural gas fell 17 US cents to US$3.04 per million barrels. BTUs.

Gold rose US$9.40 to US$2,667.90 an ounce and copper jumped 13 cents to US$4.20 a pound.