Nov 20 (Reuters) – Canada’s main stock index managed to recover early losses and edge up on Monday, supported by gains in energy stocks that offset the plunge in shares of First Quantum Minerals following the miner’s reduction of ore processing at its copper mine in Panama.
At 10:39 a.m. ET (1539 GMT), the Toronto Stock Exchange’s S&P/TSX composite index was up 29.76 points, or 0.2%, at 20,205.53.
The energy sector experienced a 0.8% climb, riding on the back of oil futures rising over 2%. This upward trajectory can be attributed to the potential deepening of supply cuts by OPEC+ in an effort to stabilize prices.
First Quantum Minerals took a hit, with its shares falling 5.4% as blockades at a local port disrupted shipments, prompting the miner to further reduce ore processing at its Panama mine. There are discussions taking place where the miner is contemplating putting its Cobre Panama mine in care and maintenance mode from Nov. 23 according to sources.
In a contrasting move, the materials sector initially faced losses due to the impact of First Quantum, but managed to make a recovery later in the day. With higher copper prices aiding the sector, it edged up 0.1%.
Investors will be turning their attention to domestic consumer inflation data expected to be released on Tuesday. Projections indicate that the annual inflation rate in October would slow to 3.2% from 3.8% in September. According to Jennifer Lee, senior economist at BMO Capital Markets, global inflation seems to be on a downward trend, and she anticipates similar results for Canada.
In addition, domestic retail sales data for September is set to be unveiled later in the week on Friday. Market watchers eagerly await these numbers to gain further insights into the Bank of Canada’s (BoC) potential interest rate decisions.
As the Canadian economy flirts with recession, concerns are mounting, especially with the potential end to the rapid growth period in the United States. The uncertain outlook has increased speculation about the BoC potentially resorting to earlier-than-expected interest rate cuts.