TSX Recovers After Early Setback, Ends Just Marginally Down

After opening modestly lower, the Canadian market fell sharply Monday morning, but kept paring losses as the session progressed and eventually ended the day just marginally down.

Worries about rapidly surging coronavirus cases across the world, and uncertainty about interest rate hikes weighed down the market earlier in the day.

The benchmark S&P/TSX Composite Index, which tumbled to 20,790.89, closed with a loss of 12.13 points or 0.06% at 21,072.32.

Healthcare and materials shares rallied sharply, contributing signifiantly to market's strong recovery from the day's lows. Energy stocks came off their lows. Technology stocks too recovered well and pared most of their losses.

Tilray Inc (TLRY.TO) soared 13.5%. Aurora Cannabis (ACB.TO) rallied 5.2%, Canopy Growth Corp (WEED.TO) climbed 3% and Cronos Group (CRON.TO) gained 1.6%.

Materials shares Sandstorm Gold (SSL.TO), Ivanhoe Mines (IVN.TO), Franco-Nevada Corp (FNV.TO), Eldorado Gold (ELD.TO), Equnox Gold Corp (EQX.TO), Turquoise Hill Resources (TRQ.TO), Osisko Gold Royalties (OR.TO), Torex Gold Resources (TXG.TO) and Agnico Eagle Mines (AEM.TO) gained 3 to 4.5%.

According to reports, the overall number of coronavirus cases is fast approaching 307 million with the spread of the Omicron variant of the virus across the globe.

On the interest rate front, the first U.S. rate hike could be in March, with Goldman expecting the Fed to raise borrowing costs at least four times by the end of 2022 versus the previous prediction of three rate hike.

The inflation data due later in the week as well as the Fed Chairman Jerome Powell's testimony in the Senate are likely to provide additional clues about the central bank's stance on rate hikes.

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