The Canadian stock market traded on a weak note on Wednesday even though the U.S. Federal Reserve announced its decision to slash interest rates by 50 basis points in a bid to cushion the economy. Despite this aggressive rate cut, the S&P/TSX Composite Index fell by 85 points, or 0.4%, to 23,593, as markets seemingly remained concerned about persistent inflation and a potential economic slowdown.
Although healthcare stocks posted solid gains, the TSX benchmark was dragged down by weakness in other major sectors, including mining, industrials, and utilities.
In its latest statement, the U.S. central bank highlighted the need to balance risks to employment and inflation as the economic outlook remains uncertain, with job gains slowing while inflation remains elevated. The Fed’s latest economic projections show GDP (gross domestic product) growth at 2% for 2024, with the federal funds rate expected to end 2024 at 4.4%.
Top TSX Composite movers and active stocks
With gold and silver prices continuing to fall for a second consecutive session, mining stocks like Aya Gold & Silver, SilverCrest Metals, Equinox Gold, First Majestic Silver, and K92 Mining dropped by at least 3.6%, making them the worst-performing TSX stocks of the day.
On the flip side, Bausch Health Companies, NFI Group, BCE, and Spin Master were the session’s top performers on the Toronto Stock Exchange, with each climbing by at least 3.2%.
Shares of Descartes Systems (TSX: DSG) also traded positively, rising 1.2% to $136.39 per share. These gains in DSG stock came after the logistics industry-focused software firm announced the acquisition of the American carrier onboarding and risk monitoring solutions provider Assure Assist.
With this acquisition, Descartes expects to expand its logistics capabilities by enabling freight brokers and shippers to screen and onboard trucking carriers while ensuring compliance with safety, insurance, and legitimacy standards. Descartes paid US$24 million upfront for the acquisition, with potential performance-based payouts of up to US$6 million over two years. On a year-to-date basis, DSG stock is now up 22.5%.
Based on their daily trade volume, Canadian Natural Resources, BCE, Pembina Pipeline, Cenovus Energy, and TD Bank were the five most active stocks on the exchange.
TSX today
Crude oil and metals prices were trading on a strong bullish note early Thursday morning, which could lift the commodity-heavy main TSX index at the open today.
While no major domestic economic releases are due, Canadian investors may want to keep an eye on the monthly manufacturing, existing home sales, and weekly jobless claims data from the United States this morning. Overall, stocks may remain volatile as investors assess the potential impact of the Fed’s recent rate cut on the economy.
Market movers on the TSX today
