October 24, 2018 / 2:37 PM / in a year

CANADA STOCKS-TSX drops on interest rate hike

Oct 24(Reuters) - Canada’s main stock index fell on Wednesday on weak investor sentiment after Bank of Canada raised benchmark interest rate.

* At 10:01 a.m. ET (14:01 GMT), the Toronto Stock Exchange’s S&P/TSX composite index was down 62.2 points, or 0.41 percent, at 15,222.97.

*The rate increase, by a quarter of a percentage point, took the bank’s overnight interest rate to 1.75 percent, still well below the “neutral” rate of 2.5-3.5 percent.

* The central bank, which so far lifted rates five times since July 2017, tweaked its standard language on future hikes, dropping previous references to the gradual pace of tightening.

* The central bank also warned that an increasing trade war between U.S. and China could become a major drag on global economic growth.

* Trade uncertainty in North America, which the bank had previously flagged as a major risk to the economic outlook, would diminish after the United States, Canada and Mexico agreed a revamped NAFTA deal.

* Nine of the index’s 11 major sectors were lower, led by a 1 percent drop in the heavyweight financials sector after the rate decision.

* Canadian National Railway shares rose 2.7 percent after the railroad reported a better-than-expected quarterly profit as the company shipped higher volumes of crude and grains.

* Shares of Restaurant Brands was flat after its quarterly profit missed Wall Street estimates as its Burger King unit struggled in a fiercely competitive U.S. market, offsetting gains in its Tim Hortons cafes.

* The energy sector climbed 0.2 percent as U.S. crude prices were up 1.0 percent per barrel, while Brent crude added 0.4 percent.

* The materials sector, which includes precious and base metals miners and fertilizer companies, lost 0.2 percent as gold futures dropped 0.2 percent to $1,231.5 an ounce.

* The largest percentage gainers on the TSX were Trican Well Service, which jumped 2.9 percent, followed by shares of Canadian National Railway.

* OceanaGold Corp fell 2.5 percent, the most on the TSX. The second biggest decliner was New Gold down 2.0 percent.

* The most heavily traded shares by volume were Aurora Cannabis, Royal Nickel, and Bombardier B .

* On the TSX, 143 issues were higher, while 88 issues declined for a 1.63-to-1 ratio favouring gainers, with traded volumes touching 16.51 million shares.

* The TSX posted no new 52-week high and one new low.

* Across all Canadian issues, there were one new 52-week highs and 17 new lows, with total volume of 27.15 million shares. (Reporting by Medha Singh in Bengaluru; Editing by James Emmanuel)

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