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Roundup: Canadian stock market climbs as U.S. Fed keeps rates unchanged

Xinhua, October 29, 2015 Adjust font size:

Canada's main stock market in Toronto Wednesday gained some momentum as the U.S. central bank kept its benchmark interest rates unchanged, in line with traders' expectation.

Following a slump for two straight days, the Toronto Stock Exchange's benchmark Standard & Poor's/TSX Composite Index gained 163.56 points, or 1.19 percent, to close at 13,863.16 points.

TSX index was boosted in the midday trading as forecasters were unanimous in expecting no rate change at the Federal Reserve's policy meeting, and market pricing similarly indicated very low odds of a hike, according to a report released by Royal Bank of Canada (RBC) Wednesday.

Financials, the most sensitive sector to the changes of central banks' interests rate, increased 1.15 percent as Toronto-Dominion Bank added 0.93 percent to 55.38 Canadian dollars (about 41.98 U.S. dollars) per share.

However, the Fed also signaled option to tighten policy rate at its next meeting in December without providing firm commitment to act by the end of the year.

"Barring any significant deterioration in the growth outlook or the return of market volatility, we expect the target range for the Fed funds rate will be raised by 25 basis points on December 16, 2015," Josh Nye, an RBC economist, said in the report.

The equities market in Toronto also moved higher amid mixed performance of resources shares. Energy rebounded sharply by 2.67 percent, while metals and mining edged down 0.53 percent, which was the only loser in the eight major sectors in TSX.

And health care logged the biggest rise by 3.82 percent when its heavyweight Valeant Pharmaceuticals International Inc. jumped 5.77 percent to 153.85 Canadian dollars on Wednesday after a heavy selloff on Monday.

Besides, industrials strengthened 1.43 percent when Bombardier Inc. spiked 11.03 percent to 1.61 Canadian dollars after the biggest Canadian aircraft and railway maker was reportedly to get significant investment from Quebec government to support its narrow-body jet program.

On the currency front, the Canadian dollar Wednesday was slightly higher to 0.7580 U.S. dollar at 4 o'clock (the Canadian Eastern Daylight Time), when compared with 0.7538 U.S. dollar on Tuesday. Enditem