TSX climbs to 8-week high as tech and finance recover

July 13 (Reuters) – Canada’s main stock index rose to a nearly eight-week high on Thursday, led by gains for tech and financial stocks, as investors grew more optimistic that central banks are nearing the end of their rate hike campaigns.

The Toronto Stock Exchange’s S&P/TSX composite index (.GSPTSE) ended up 206.87 points, or 1%, at 20,277.64, its highest closing level since May 19.

US equities also rose as data showed a slowdown in US producer inflation, supporting the view that the Federal Reserve will stop raising rates after an expected 25 basis point rate hike later this month.

The Bank of Canada has also tightened monetary policy. On Wednesday, it raised its benchmark rate to a 22-year high of 5%.

“While the Bank of Canada wasn’t particularly lenient with its rate hike yesterday, I think the general consensus is that we’re very close to the end,” said Philip Petursson, chief investment strategist at IG Wealth Management.

“Valuation on the TSX is quite attractive. Even though we have some economic headwind ahead of us, it’s hard to see how that isn’t already priced into equities,” added Petursson.

There was one less economic headwind to worry about as longshoremen in ports along Canada’s Pacific coast and their employers accepted a tentative pay deal. That ended a 13-day strike that disrupted trade in the country’s busiest ports and threatened a worsening of inflation.

The technology sector of the Toronto market rose 3.1% while shares of e-commerce company Shopify Inc (SHOP.TO) rose 6.1%.

Heavily weighted financials added 1.2%, while energy was up 0.6% while oil was up 1.5% at $76.89 a barrel.

Reporting by Fergal Smith in Toronto and Siddarth S and Shashwat Chauhan in Bengaluru; Edited by Pooja Desai and Will Dunham

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