By Ketki Saxena
TSX at Midday: Canada's Benchmark at New Record High; Financials Surge, Offsetting Energy Losses
Investing.com – As of 12:30 p.m ET, the TSX was at a new record high of 22,091.7 points, or 0.38% higher in the day’s trading.
Gains on Canada’s key index were driven primarily by the financial sector, towards which the TSX Index is heavily weighted. The heavyweight financial sector has a nearly equal weighting to the Energy and Materials sector combined, at about 30%.
North American equities surged on expectations of higher interest rates after Jerome Powell’s hawkish comments yesterday. Banks are the main beneficiaries of interest rates, allowing them to widen interest income margins. Monetary policy is also expected to tighten significantly in Canada, and Canada’s big banks have significant U.S. exposure as well.
Gains in the heavyweight financials and tech sector (+2.46%), as well as in industrials (+0.84%) , health care (+1.94%), and consumer discretionary (0.83%) helped offset losses in Energy (-1.08%) and metals and mining (-0.87%).
Energy was driven downwards by a drop in crude prices, with WTI down 1.54% so far today, as EU stakeholders remain split on whether to enact an Embargo on Russian energy. Natural gas was 4.33% higher.
In New York, the S&P500 was up 0.87%, the Dow Jones was 0.6% higher, and the Nasdaq was up 1.48%.