TSX flat as tech and materials losses offset energy gains
The TSX index dipped 0.2% today as tech losses offset energy gains. Investors monitored Middle East tensions and U.S. inflation data ahead of the Fed meeting.
The main stock index in Canada remained relatively flat on Wednesday as gains in the energy sector were offset by declines in technology and materials. Investors continued to monitor geopolitical developments in the Middle East, which have kept markets on edge. At mid-morning, the S&P/TSX composite index was down 0.2% at 33,146.43 points.
Energy stocks were the primary gainers, rising 2.4% as crude oil prices remained elevated. This strength persisted despite a recommendation from the International Energy Agency to release 400 million barrels of oil to restrain prices while the Strait of Hormuz remains a focal point of tension. Allan Small, senior investment adviser at Allan Small Financial Group, commented on the potential for price shifts:
"Oil is likely to hover in the mid-$80s to around $90 if shipping through the Strait of Hormuz remains disrupted, but if tankers can sail through, you could see WTI drop back into the low $70s almost immediately."
In contrast to expectations of a pullback, the military command in Iran warned that the world should prepare for oil to hit $200 a barrel following reports of attacks on ships in the Gulf. Meanwhile, in the United States, President Donald Trump told Axios that the conflict would end soon, stating that there are few targets left in the region. These gains were countered by a 2% drop in information technology stocks and a 1% loss in materials, as prices for most base and precious metals faced downward pressure. The benchmark TSX has declined about 3% since the start of the conflict, though energy remains the strongest sector so far this year.
On the economic front, data showed that consumer prices in the American market rose moderately in February, suggesting the Federal Reserve may hold interest rates steady in its upcoming meeting. In corporate news, goeasy Ltd. saw its shares slump 12.1% after more than halving in value during the previous session. The lender flagged a charge-off of approximately C$178 million and write-downs linked to its LendCare unit.
