Toronto market ends slightly down as Magna slides
TSX ends 2.03 points lower at 20,629.55
Engine shares fell 7.2%
Technology falls 1.1%
Court rejects antitrust effort to block Rogers-Shaw deal
January 24 (Reuters) –
Canada’s main share index edged slightly lower on Tuesday, pressured by a sharp decline in shares of Magna International Inc and concerns that higher borrowing costs will weigh on the earnings outlook. corporate.
The Toronto Stock Exchange’s S&P/TSX composite index ended down 2.03 points at 20,629.55, after posting its highest close in more than seven months on Monday.
The benchmark US S&P 500 index also finished slightly lower.
“The issue for 2023 is going to be seeing the lingering effects of the interest rate hikes that happened last year,” said Brian Madden, chief investment officer at First Avenue Investment Counsel in ‘Toronto.
“The bigger issue for Canada and the United States will be not so much digesting the rate hikes but resetting expectations for corporate earnings because they are too high, given the macroeconomic environment.”
Investors worry that aggressive interest rate hikes could trigger a recession, with data on Tuesday showing that US business activity
for the seventh consecutive month in January.
The Bank of Canada will raise its key interest rate by a quarter of a percentage point to 4.5% on Wednesday and then hit a pause in its tightening campaign, a Reuters poll of economists showed.
Magna shares fell 7.2% after the auto supplier cut its profit margin outlook. This weighed on the discretionary consumer sector, which lost 0.7%.
Technology fell 1.1% and energy fell 1% as US crude oil futures settled 1.8% lower at $80.13 a barrel, giving back some of the recent gains his
rejected the competition bureau’s effort to block Rogers Communications Inc’s C$20 billion ($14.9 billion) bid to buy Shaw Communications Inc, in a boost to the companies’ efforts to close a deal reached nearly two years ago .
Rogers was up 2.9% and Shaw was up 2.8%. (Reporting by Fergal Smith; Additional reporting by Shashwat Chauhan in Bengaluru; Editing by Krishna Chandra Eluri and Deepa Babington)