By Ketki Saxena
Investing.com -- At 11:10 a.m in Toronto, The S&P/TSX Composite was at 19,948.85 points, down 1.11% in the day’s trading, tracking Wall Street lower following U.S. Federal Reserve Chief Jerome Powell’s hawkish remarks at Jackson hole.
Chief Jerome Powell's comments suggested the central bank will keep raising rates aggressively to tame inflation even at the cost of a “Sustained period of below-trend growth”.
“These are the unfortunate costs of reducing inflation,” Powell noted in his speech, “But a failure to restore price stability would mean far greater pain.”
Money market traders saw about 55% odds of a 75 basis point rate hike in September versus 45% before the speech.
The commodity-heavy Canadian index was also pressured by losses in crude on worries of slowing demand as the global economy cools, although further losses were capped by UAE’s alignment with Saudi Arabia on the prospect of cuts to crude output.
Today’s Biggest Stories on Bay Street
Canadian Western Bank (TSX:CWB) profits fell compared to a year earlier as the Bank shored up its provisions for credit losses. On an adjusted basis, CWB says it earned 90 cents in the quarter, in line with analyst estimates and compared with an adjusted profit of $1.01 per share a year earlier. Revenue totalled $271.7-million, up from $263.2-million in the same quarter last year.
Open Text is buying U.K.-based Micro Focus International in an all-cash deal valued at US$6 billion. The deal will enable open Text to double its total addressable market to US$170 billion and allow it to tap into what the company calls a “marquee customer base.” OpenText will pay US$6.30) in cash for each Micro Focus share, a 98.7% premium over Micro Focus's closing price yesterday.
TD (TSX:TD) had price targets revised upwards by several analysts ) following its slightly better-than-expected earnings report yesterday. RBC (TSX:RY) analyst Darko Mihelic upgraded TD’s rating to “outperform” from “sector perform” but maintained his price target at $106. Credit Suisse (SIX:CSGN) analyst Joo Ho Kim raised his target to $95 from $94. Canaccord Genuity (TSX:CF), by contrast, cut its price target to $94.50 from $96 in the wake of the earnings.
Canadian Imperial Bank of Commerce also had price targets revised upwards following also its slightly better-than-expected report yesterday. KBW raised its target price to $70 from $68 and National Bank of Canada (TSX:NA) raised its price target to $84 from $83. Credit Suisse analyst Joo Ho Kim maintained a $76 price target and “outperform” rating.
Canadian Stocks Moving Markets This Morning
Biggest Losers:
- Open Text Corp (TSX:OTEX)(-12.42%)
- ECN Capital Corp (TSX:ECN) (-6.85%)
- Canopy Growth (TSX:WEED) (-6.80%)
Top Gainers:
- Advantage Oil & Gas Ltd. (TSX:AAV)(+3.90%)
- Vermilion Energy (TSX:VET) (+1.77%) 0
- ARC Resources (TSX:ARX) (+1.56%)
In Canadian Economics
The Canadian federal government recorded a $10.2 billion surplus over the first quarter of the fiscal year, joining some provincial governments in reporting recent improvements to their bottom lines. The report recorded a $4.9 billion surplus for the month of June, compared to a $12.7 billion deficit in June 2021.