TSX Today: What to Watch for in Stocks, as Canada Raises Interest Rates

The ongoing geopolitical uncertainties are likely to keep the TSX stocks extremely volatile and unpredictable.

TSX Today

The ongoing Russia-Ukraine war is keeping the global stock market highly unpredictable without any clear direction. The Canadian equities market turned positive again on Wednesday, as the TSX Composite Index inched up by 251 points, or 1.2%, to settle at 21,256.

Interest rate hike and Ukraine crisis

The geopolitical tension-driven supply concerns resulted in a third straight day of a sharp rally in crude oil prices. In spite of that, all key sectors on the TSX benchmark traded positively on March 2, with industrials, financials, consumer cyclicals, and energy sectors leading the rally.

The Bank of Canada raised the key interest rate from 0.25% to 0.5% yesterday as anticipated, marking its first rate hike in more than three years. In line with the expectations, the U.S. Federal Reserve chair Jerome Powell also indicated an interest rate hike later this month, citing a strong labour market and high inflation. While commenting on the recent Russian invasion of Ukraine, Powell stated that its “implications for the U.S. economy are highly uncertain, and we will be monitoring the situation closely.”

Significantly better-than-expected non-farm employment data from the U.S. market could be another reason for stock market gains in the last session.

Top TSX movers and active stocks

Converge Technology Solutions (TSX:CTS) stock jumped by 6.3% on Wednesday to $9.74 per share, making it the top gainer for the day on the TSX. These gains in CTS stock came a day after the Canadian software company revealed that its subsidiary Portage CyberTech has acquired the Victoria-based software firm 1CRM Systems Corp. Converge Technology expects this acquisition to help the company provide better business management solutions to its clients. Despite yesterday’s sharp gains, Converge Technology stock is still trading with more than 10% year-to-date losses.

Element Fleet Management, Secure Energy Services, Kinaxis, and Nexgen Energy were also among the top-performing TSX Composite components on March 2, as they rose by at least 5% each.

In contrast, Aecon Group, Canfor, Docebo, and Fortuna Silver Mines were the four worst-performing stocks on the main Canadian market index. While Aecon stock lost nearly 8% of its value after missing its Q4 earnings estimates, the shares of the other three companies lost at least 3% each.

TSX today

Early Thursday morning, WTI crude oil prices spiked up to their highest level since 2008 amid escalating Russia-Ukraine conflict. At the same time, copper futures prices were also trading with over 2% gains for the day. These factors could take some TSX energy and mining stocks higher at the opening today. But I expect the geopolitical uncertainties to keep the broader market extremely volatile and unpredictable.

While no major domestic economic releases are due today, Canadian investors could watch the latest jobless claims and non-manufacturing PMI data from the U.S. market this morning. The Fed chair Jerome Powell’s testimony, which started yesterday, will continue today and add to the market volatility.

The corporate events front, Toronto-Dominion Bank, Martinrea International, Artis REIT, Park Lawn, Enghouse Systems, and MEG Energy are expected to announce their latest quarterly results today.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

The Motley Fool owns and recommends Enghouse Systems Ltd. The Motley Fool recommends Docebo Inc. and KINAXIS INC. Fool contributor Jitendra Parashar has no position in any of the stocks mentioned.

More on Energy Stocks

Arrowings ascending on a chalkboard
Energy Stocks

Beat the TSX With This Cash-Gushing Dividend Stock

Canadian Natural Resources stock is well set up to beat the TSX as it continues to generate strong cash flows…

Read more »

energy industry
Energy Stocks

2 TSX Energy Stocks to Buy Hand Over Fist Now

These two rallying TSX energy stocks can continue delivering robust returns to investors in the long term.

Read more »

green energy
Energy Stocks

1 Magnificent TSX Dividend Stock Down 37% to Buy and Hold Forever

This dividend stock has fallen significantly from poor results, but zoom in and there are some major improvements happening.

Read more »

oil tank at night
Energy Stocks

3 Energy Stocks Already Worth Your While

Here's why blue-chip TSX energy stocks such as Enbridge should be part of your equity portfolio in 2024.

Read more »

Solar panels and windmills
Energy Stocks

1 Beaten-Down Stock That Could Be the Best Bet in the TSX

This renewable energy stock could be one of the best buys you make this year, as the company starts to…

Read more »

Dice engraved with the words buy and sell
Energy Stocks

Is Enbridge Stock a Buy, Sell, or Hold?

Here's why Enbridge (TSX:ENB) remains a top dividend stock long-term investors may want to consider, despite current risks.

Read more »

Gas pipelines
Energy Stocks

If You Had Invested $5,000 in Enbridge Stock in 2018, This Is How Much You Would Have Today

Enbridge's high dividend yield hasn't made up for its dismal total returns.

Read more »

Bad apple with good apples
Energy Stocks

Avoid at All Costs: This Stock Is Portfolio Poison

A mid-cap stock commits to return more to shareholders, but some investors remember the suspension of dividends a few years…

Read more »