FX.co ★ TSX Ends Lower Despite BoC's Sharp Rate Cut

The Canadian stock market concluded Wednesday's session on a weaker note, primarily driven by declines in technology, energy, and materials sectors. This downturn persisted despite the Bank of Canada's decision to reduce interest rates by 50 basis points. Investor sentiment remained cautious due to concerns about economic growth prospects and ongoing tensions in the Middle East.

The S&P/TSX Composite Index dropped by 143.08 points, or 0.58%, closing at 24,573.62, just 20 points above the day's low of 24,453.40. The index experienced a continuous downward trend throughout the trading session.

In a widely anticipated move, the Bank of Canada lowered its overnight rate target by 50 basis points to 3.75%, with the Bank Rate set at 4% and the deposit rate at 3.75%. This decision comes as consumer price inflation has notably decreased from 2.7% in June to 1.6% in September.

"With inflation now approximately at the 2% target, the Governing Council opted to cut the policy rate by 50 basis points to bolster economic growth while keeping inflation within the 1% to 3% range," stated the central bank.

The Bank of Canada also indicated a potential for further rate cuts if the economy aligns with its projections. However, it emphasized that the timing and magnitude of future adjustments will depend on incoming data and its effect on the inflation outlook. "Decisions will be made on a meeting-by-meeting basis," reiterating its dedication to price stability by maintaining inflation near the 2% goal.

Seabridge Gold (SEA.TO) fell nearly 6.5%, while Cameco Corporation (CCO.TO), Trisura Group (TSU.TO), Premium Brands Holdings Corporation (PBH.TO), TFI International (TFII.TO), and Shopify Inc (SHOP.TO) registered declines between 2.3% and 4.5%.

Additional major decliners included Imperial Oil (IMO.TO), Constellation Software (CSU.TO), BlackBerry (BB.TO), Coveo Solutions (CVO.TO), Docebo Inc (DCBO.TO), MEG Energy (MEG.TO), Cenovus Energy (CVE.TO), Iamgold (IMG.TO), Eldorado Gold (ELD.TO), and Hudbay Minerals (HBM.TO).

Conversely, Celestica Inc (CLS.TO) saw a rise of 2.6%, with Restaurant Brands International (QSR.TO) gaining nearly 2%. Other gainers included Cogeco Inc. (CGO.TO), Cogeco Communications (CCA.TO), EQB Inc (EQB.TO), Boyd Group Services (BYD.TO), and goeasy (GSY.TO), which posted increases of 1% to 1.5%.

Gold futures closed lower on Wednesday, influenced by a rise in the U.S. dollar and bond yields, along with profit-taking following six consecutive days of gains. Gold futures for October settled down $29.80 or approximately 1.1%, at $2,714.40 per ounce. October silver futures declined by $1.1910 or about 3.4%, closing at $33.640 an ounce, while November copper futures decreased by $0.0590, or roughly 1.35%, to $4.2960 per pound.

Oil prices also fell on Wednesday, pressured by data indicating a larger-than-expected increase in U.S. crude oil inventories for the week ending October 18th. West Texas Intermediate crude oil futures for December fell by $0.97, or approximately 1.35%, closing at $70.77 per barrel.