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TSX Sluggish After Rate Hike -- Canadian Commentary

Canadian stocks are set for a lackluster open Thursday, a day after the Bank of Canada raised interest rates for the first time in seven years.

The central bank raised its benchmark rate to 0.75 percent from 0.5 percent, but said future rate hikes will be "guided" by the incoming economic data.

"Governing Council judges that the current outlook warrants today's withdrawal of some of the monetary policy stimulus in the economy. Future adjustments to the target for the overnight rate will be guided by incoming data as they inform the bank's inflation outlook, keeping in mind continued uncertainty and financial system vulnerabilities," the bank said in its statement.

The TSX Composite was flat yesterday.

Energy stocks may struggle today, as WTI light sweet crude oil was down 30 cents at $45.19 a barrel.

OPEC's compliance with production cuts fell in June to its lowest since the deal with Russis kicked in early in the year, according to the International Energy Agency.

"Each month something seems to come along to raise doubts about the pace of the rebalancing process. This month, there are two hitches: a dramatic recovery in oil production from Libya and Nigeria and a lower rate of compliance by OPEC with its own output agreement," the Paris-based IEA said.

Sears Canada Inc (SCC.TO) majority shareholders including Edward Lampert, ESL Investments Inc and Fairholme Capital Management LLC are "seeking access to internal documents related to its restructuring," according to Reuters.

Cenovus Energy Inc (CVE.TO) has hired investment banks to sell the Weyburn and Palliser oil assets in hopes of getting $2.5 billion, Reuters also reports.

by RTT Staff Writer

For comments and feedback: editorial@rttnews.com

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