Major U.S. and Canadian stock indexes closed with modest gains on Wednesday after a choppy trading session, with investors holding their cards close to the vest ahead of the presidential debate and an inflation report closely watched by Federal Reserve policy makers.
In Toronto, gains for the materials sector and industrials offset declines for interest rate sensitive shares. The S&P/TSX composite index ended up 5.42 points at 21,793.90.
Canada’s 10-year yield touched its highest level since June 11 at 3.482% after data on Tuesday showed a surprise acceleration in Canadian inflation. The data has reduced the chances of the Bank of Canada cutting interest rates further in July. Earlier this month, the BoC cut its benchmark rate by 25 basis points to 4.75%.
The materials group, which includes metal miners and fertilizer companies, rose 1.3%, to notch its highest closing level since June 10.
First Quantum Minerals Ltd shares were up 7.4% after Deutsche Bank raised its target price on the stock.
Industrials also posted gains, rising 0.6%.
Financials fell 0.4%, with Onex Corp down 2.2%. WestJet Airlines, which is part of Onex’s portfolio of assets, said a union representing its maintenance engineers had rejected its new pay offer and served a second strike notice.
Real estate lost 1.3% and utilities ended 0.7% lower.
On Wall Street, leading chipmaker Nvidia closed up 0.25%, surging just before the closing bell to erase losses. Other megacaps such as Apple, Amazon.com and Tesla also posted gains.
Several economic data releases are due this week, leading to Friday’s release of the personal consumption expenditures (PCE) price index, the Federal Reserve’s preferred inflation gauge used to decide on the path of monetary policy.
The Fed has been projecting only one interest rate cut this year, in December. But investors see a 56.3% chance of a 25-basis point rate cut in September, and about two cuts by the year-end, LSEG’s interest rate probabilities app showed.
The Dow Jones Industrial Average rose 16.10 points, or 0.04%, to 39,128.26, the S&P 500 gained 8.61 points, or 0.16%, to 5,477.91 and the Nasdaq Composite gained 87.50 points, or 0.49%, to 17,805.16.
Positive earnings and benign inflation data could encourage more rotation from tech to sectors that have lagged this year, said Ryan Detrick, chief market strategist at the Carson Group.
Earlier this week, investors had increased bets on non-technology sectors.
“We’re probably going to see this choppiness continue until there is a catalyst,” said Brian Jacobsen, chief economist at Annex Wealth Management.
Appliances manufacturer Whirlpool surged 17.1% after Reuters reported that German engineering group Robert Bosch is weighing a bid for the U.S. appliances maker.
FedEx jumped 15.53% after the delivery giant forecast fiscal 2025 profit above estimates, boosting the Dow Jones Transport index to its highest in over a month.
Apple rose nearly 2% after Rosenblatt upgraded the iPhone maker’s stock to “buy” from “neutral”. Tesla gained 4.81% as Stifel initiated coverage with a buy rating.
Shares of Amazon Inc rose 3.90%, bringing the company’s market value above $2 trillion, the fifth U.S. corporation to cross that level.
Rivian soared 23.24% as German automaker Volkswagen said it will invest up to $5 billion in the U.S. electric-vehicle maker.
General Mills fell 4.59% after the Cheerios cereal maker forecast annual profit below estimates and posted a bigger-than-expected drop in quarterly sales.
Declining issues outnumbered advancers by a 1.41-to-1 ratio on the NYSE. There were 106 new highs and 89 new lows on the NYSE. The S&P 500 posted 10 new 52-week highs and 6 new lows while the Nasdaq Composite recorded 41 new highs and 171 new lows. Volume on U.S. exchanges was 10.59 billion shares, compared with the 11.83 billion average for the full session over the last 20 trading days.
Reuters, Globe staff