Closing Bell TSX falls Wall Street rises as Fed signals its in

October 8, 2019


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TORONTO — North American markets were mixed Wednesday as the U.S. Federal Reserve signalled it still plans on keeping its key interest rate at a record low for a considerable time.Here are the closing numbersTSX — 15,458.88-51.66 -0.33%S&P 500 —  2,001.57 +2.59 0.13%Dow — 17,156.85 +24.88 0.15%Nasdaq — 4,562.19 +9.43 0.21%The S&P/TSX composite index fell 51.66 points to 15,458.88, weighed down by gold and energy stocks. The Canadian dollar dipped 0.28 of a cent to 90.88 cents US.The U.S. central bank says it will keep its benchmark rate near zero as long as inflation remains under control and until it sees consistent growth in wages, long-term unemployment and other gauges in the job market. It says it will also make another $10-billion cut in the pace of its monthly bond purchases, which have fuelled stock markets and kept long-term borrowing rates low. The program is still slated to end in October.Most economists have said they think the Fed will raise rates starting around mid-2015. But as the U.S. economy has strengthened, speculation had intensified about whether it might do so sooner, perhaps by March.There was little reaction to the Fed’s decision to not move on interest rates. On Wall Street, the Dow Jones industrials was ahead 24.88 points to close at a record high of 17,156.85. The Nasdaq was up 9.43 points at 4,562.19, and the S&P 500 index advanced 2.59 points to 2,001.57.“With (quantitative easing) ending next month, inflation cooling a bit, and the economic data muddled (the Q2 rebound from Q1 making it hard to discern underlying trends), the Fed opted to hold its ground,” Michael Gregory, managing director and deputy chief economist at BMO Capital Markets said in a note.Ian Nakamoto, a director of research at 3Macs, said much of the Fed’s decision is “data dependent” and signs are still pretty mixed on when the U.S. economy will be able to withstand a hike in short-term interest rates.“In the back of my mind, they’re going to err on the side of being cautious,” said Nakamoto. “(Yellen) is still very cautious of the stability of the U.S. economy.”Before the policy announcement, the U.S. government reported that consumer prices fell by a seasonally adjusted 0.2% in August, the first monthly drop in prices in 16 months.Meanwhile, the other major event that is adding some volatility to markets is Thursday’s Scottish referendum on independence. Polls show the Yes and No camps are neck and neck, with undecided voters expected to be the difference. Secession would have complications for Scotland, from currency to its membership in the European Union and NATO.In corporate news, U.S. Steel Canada has filed for court-supervised protection to give it a chance to restructure to better compete in the North American steel industry. The former Stelco Inc, which U.S. Steel bought in 2007, has recorded operating losses in the last five years for about $2.4 billion, the company and its parent, U.S. Steel, said in statements after markets closed on Tuesday.In commodities, the October crude contract on the New York Mercantile Exchange dropped 46 cents to US$94.42 a barrel. December gold bullion fell 80 cents to US$1,235.90 an ounce, while December copper dipped two cents to US$3.14 a pound.TOP STORIESFed to end bond buying next month, renews pledge to keep rates low for ‘considerable time’U.S. Steel stock soars after Canadian unit files for creditor protectionTwo new iPads? The release of OS X Yosemite? Apple is planning another event on Oct. 21, report saysToronto and Vancouver’s red-hot housing markets aren’t as ‘insane’ as they look, says CIBC’s top economistThe reviews are out and everyone is saying the iPhone 6 is the best smartphone you can buyApple released iOS 8 today, but whatever you do, don’t put it on your iPhone 4SWHAT’S ON DECK THURSDAYECONOMIC NEWSCANADA8:30 a.m. International securities transactions (July)UNITED STATES8:30 a.m.Weekly jobless claims: Economists expect 305,000 new claims, down from last week Housing starts, building permits (Aug): Economists expect 5.2% decline in starts, 1.6% decline in permits 10 a.m.Philadelphia Fed Index (Sept): Economists expect reading of 23, down from last month 12 p.m.Flow of funds CORPORATE NEWSCANADAGluskin Sheff + Associates Inc Q4 earnings: Analysts expect $1.10 a share UNITED STATESConAgra Foods Inc  Q1 earnings: Analysts expect 35¢ a share Oracle Corp   Q1 earnings: Analysts expect 64¢ a share Red Hat Inc   Q2 earnings: Analysts expect 38¢ a share read more