TSX Ends On Weak Note

(RTTNews) - Despite the Canadian central bank's decision to reduce interest rates by 25 basis points, the Canadian market ended weak on Wednesday due to a sell-off in technology stocks after a few big name U.S. tech firms reported disappointing quarterly numbers.

The Bank of Canada today reduced interest rates by another quarter point, as widely expected, saying that the decision to lower rates for the second straight meeting came as broad price pressures continue to ease and inflation is expected to move closer to 2%.

The benchmark S&P/TSX Composite Index ended down 174.18 points or 0.76% at 22,639.57, the day's low. The index briefly moved into positive territory at the start, rising to 22,844.82.

Consumer discretionary, industrails and healthcare stocks were the other major losers in the session. Financials and real estate stocks were also weak. Energy, materials and communications stocks ended mixed, while utilities shares found some support.

The Information Technology Capped Index shed 2.17%. Celestica Inc (CLS.TO) fell more than 7%. Shopify Inc (SHOP.TO) ended 5.2% down. Lightspeed Commerce (LSPD.TO), Bitfarms (BITF.TO), Quarterhill (QTRH.TO), BlackBerry (BB.TO), Coveo Solutions (CVO.TO) and Computer Modelling Group (CMG.TO) lost 2 to 4.3%.

Healthcare stock Bausch Health Companies (BHC.TO) tanked more than 23%. Tilray Inc (TLRY.TO) ended down 5.4%.

Consumer discretionary stocks Pet Valu Holdings (PET.TO), Mty Food Group (MTY.TO), Brp Inc (DOO.TO), Canada Goose Holdings (GOOS.TO) and Magna International (MG.TO) closed lower by 2.3 to 3%.

In the industrials sector, Ats Corp (ATS.TO), Bombardier Inc (BBD.B.TO), Cae Inc (CAE.TO), Canadian National Railway (CNR.TO) and Nfi Group (NFI.TO) ended down 3 to 4.3%.

The Canadian central bank said this morning that it has reduced its target for the overnight rate by 25 basis points to 4.5%, with the bank rate at 4.75% and the deposit rate at 4.5%.

The Bank of Canada also said consumer price inflation is expected to come down below core inflation in the second half of this year, largely because of base year effects on gasoline prices.

However, the central bank noted price pressures in some important parts of the economy—notably shelter and some other services—are holding inflation up.

The Bank of Canada said its Governing Council is carefully assessing these opposing forces on inflation and noted future monetary policy decisions will be guided by incoming information and their assessment of their implications for the inflation outlook.