(Updates prices, adds analyst comments)
By Amal S.
June 8 (Reuters) – Losses in industrial and financial stocks dragged Canada’s main stock index lower on Wednesday as investors feared aggressive central bank policy tightening could stifle economic growth.
As of 9:39 a.m. ET (1339 GMT), the Toronto Stock Exchange’s S&P/TSX Composite Index was down 61.64 points, or 0.29%, at 20,866.57, on track to put end to his two-day winning streak.
The Organization for Economic Co-operation and Development on Wednesday lowered its global growth forecast for 2022 to 2.8% from 3.2%, a day after the World Bank cut its estimate by nearly a third to 2, 9%.
The financial sector fell 0.6%, while the industrial sector fell 0.9%, driving the index’s losses.
The heavyweight energy sector climbed 0.1% for a fourth consecutive session, as US crude prices rose 0.7% a barrel, while Brent crude gained 0.9%.
“General market sentiment right now is hesitant. I think people are waiting to see what the central banks have to say. We’re a week away from the Fed meeting, and the 10-year yield sits at 3%,” said Colin Cieszynski, chief market strategist at SIA Wealth Management.
“The ECB is meeting tomorrow and it’s the big immediate meeting.”
The focus of the week is on US consumer inflation data due on Friday.
The Fed is on track to propose a half-point interest rate hike at its June and July policy meetings, and a high inflation reading would add to expectations of aggressive tightening even in the second half of the year.
The materials sector, which includes precious and base metal mining companies and fertilizer companies, lost 0.5%, weighed down by weak copper prices.
In corporate earnings, Dollarama Inc. jumped 2.9% to top the index after beating quarterly sales estimates as soaring inflation fueled demand for groceries and food. Household essentials from discount store. (Reporting by Amal S in Bengaluru; Editing by Anil D’Silva)