Canada's main stock market outperformed its U.S. counterparts in a broad-based advance, as Governor Poloz's speech and Q&A underpinned expectations for a continuation of the gradual and cautious approach to trimming stimulus this year. The S&P/TSX Composite Index gained 42 points or 0.3% to close at 15,647. U.S. markets lost ground, with the Dow Jones shedding about 170 points following the ouster of U.S. Secretary of State Rex Tillerson.
Materials led gainers on the TSX Tuesday, rising 1%, as gold and silver prices climbed. Energy was also stronger (+0.5%) despite crude oil prices dropping more than 1%. Financials were flat while consumer staples shed 0.6%.
Instock news heavily traded Aurora Cannabis (ACB.TO) lost 2% while Bombardier (BBD-B.TO) gained 0.4%. Influential stocks today included TD Bank (TD.TO), which was flat, and Canopy Growth (WEED.TO), off nearly 2%.
In economic news, the governor of the Bank of Canada says the federal government's steps in the last couple of years to take on more public debt has helped prevent an even faster build-up of household debt. Stephen Poloz says Ottawa's recent spending on programs, such as enhanced child benefits and infrastructure, have lifted the economy and pushed interest rates to a level higher than they would have been without government stimulus. He adds the higher rates have helped keep the accumulation of household debt lower than it otherwise would have been had Canada continued with government belt-tightening approaches of the past. Poloz made the comments following a speech at Queen's University in Kingston where he emphasized the "untapped potential" of the Canadian economy. Meanwhile, the OECD has slightly improved its economic outlook for Canada but warns trade protectionism remains a key risk to the global economy. The Paris-based economic think-tank says it now expects the Canadian economy to grow 2.2% this year, up from an earlier prediction of 2.1%. It also raised its Canadian growth outlook for next year to 2%, compared with its forecast in November for 1.9%.
The Canadian dollar lost about eight-tenths of a cent to 77.11 US.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
