Toronto stocks set for breather, commodities cool
TORONTO, March 12 (Reuters) - The Toronto Stock Exchange's main index was set to cool on Wednesday, and may see some profit taking, as commodities slide lower and investors take a second look at the Fed-led rally in the previous session.
Hot off its biggest one-day gain in 1-1/2 months, the TSX could see weakness in its heavyweight energy sector as the prices of both crude oil and natural gas slip into negative territory.
U.S. crude futures were off 25 cents at $108.50, easing from a series of record highs logged over the last few days.
The TSX energy sector climbed 2.2 percent on Tuesday. The materials sector jumped 4.8 percent, but could decline along with base metals on Wednesday.
Steve Ibel, institutional equities trader at Beacon Securities in Halifax, Nova Scotia, said the Canadian market was likely headed for a flat opening, but noted: "There are those in this market that want to sell on the strength."
The U.S. Federal Reserve strengthened global markets in the previous session, pledging to work in concert with other central banks to inject hundreds of billions of dollars in liquidity into the world's drying credit markets.
"While the market loved the solution yesterday, $200 billion (from the Fed) is really not a lot of money," said Ibel. "There's been a huge, huge excess of debt in the United States for a long time, and it's finally starting to trickle down to the consumer."
The S&P/TSX composite index .GSPTSE starts the day at 13,344.53 after surging 339.44 points, or 2.6 percent, in the previous session.
($1=$0.99 Canadian) (Reporting by Jonathan Spicer; Editing by Renato Andrade)
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