Stocks Recover on Liberal Minority Win

·3 min read

Equities in Canada’s largest centre rebounded on Tuesday, as Prime Minister Justin Trudeau's victory in the federal election raised hopes his government would keep the stimulus taps open, while higher oil prices lifted energy stocks.

The TSX Composite recouped 112.15 points to open Tuesdaay at 20,266.69.

The Canadian dollar lost 0.13 cents to 77.98 cents U.S.

Trudeau hung onto power on Monday, saying he had won a clear mandate to govern although he fell short of his goal for a majority win. The Liberals have pledged a substantial $78 billion in new spending over five years.

Teck Resources cut its forecast for annual refined zinc production on Tuesday, citing an impact on its operations from wildfires in British
Columbia. Teck shares dropped $1.08, or 3.5%, to $29.62.

JP Morgan raised the price target on Canacol Energy to $8.50 from $5.00. Canacol shares improved nine cents, or 2.6%, to $3.37.

CFRA cuts the rating on Gildan Activewear to hold from buy. Gildan shares gained 15 cents to $47.17.

National Bank of Canada starts coverage on Green Impact Partners with outperform rating. Green Impact jumped 17 cents, or 2.3%, to $7.50.

On the economic page, Statistics Canada reported its new housing price index rose 0.7% in August, continuing the upward trend that began in May 2020.

ON BAYSTREET
The TSX Venture Exchange jumped 12.59 points, or 1.5%, to 866.48

All but two of the 12 TSX sectors were higher mid-morning, with health-care soaring 2.1%, communications better by 1%, and real-estate up 0.8%.

Only energy and materials missed the party, each falling 0.1%.

ON WALLSTREET

U.S. stocks rebounded on Tuesday as investors bought the dip a bit following the S&P 500's worst day since May.

The Dow Jones Industrial Average restocked 107.64 points to 34,078.11,

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The S&P 500 gained 7.28 points, or 1.7%, to 4,365.01,

The NASDAQ Composite picked up 48.95 points to 14,762.85.

Gains were kept in check as investors awaited the end of the Federal Reserve’s two-day meeting, which kicked off Tuesday.

Tuesday’s comeback was broad, but slight in magnitude with most major stocks inching only slightly higher. Uber shares were a standout, jumping 6% after raising its outlook for the third quarter.

Energy stocks also bounced big as oil snapped back after selling off Monday as the China property market situation caused concerns about overall global growth. ConocoPhillips was up 2%.

Investors are looking for more information from Fed Chairman Jerome Powell Tuesday about the central bank’s plans to taper its bond buying, specifically when that will happen. Powell said last month that he sees the Fed slowing its $120 billion in monthly purchases at some point this year.

The Fed will release its quarterly economic forecasts, the so-called dot plot, along with the statement on interest rates at 2 p.m. ET Wednesday. Powell

Prices for 10-Year Treasurys regained ground, lowering yields to 1.31% from Monday’s 1.32%. Treasury prices and yields move in opposite directions.

Oil prices fell 22 cents to $70.07 U.S. a barrel.

Gold prices gained $12.30 to $1,776.10 U.S. an ounce.


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