Toronto market moves closer to record high as cyclicals rally

·1-min read
FILE PHOTO: The facade of the original Toronto Stock Exchange building is seen in Toronto

By Fergal Smith

TORONTO (Reuters) - Canada's main stock index rose on Tuesday, moving back in reach of a record high, as investors looked for bargains in sectors sensitive to the economic outlook.

The Toronto Stock Exchange's S&P/TSX composite index ended up 140.41 points, or 0.6%, at 22,018.82. Last month, it touched a record closing high at 22,087.22.

Wall Street also gained ground as optimism about corporate earnings offset a move to multi-year highs for bond yields.

Rising interest rates and surging energy prices have weighed this year on stocks that are particularly sensitive to the economic outlook, or cyclical stocks.

"Buyers are starting to look at some of the cyclical names and saying now we are at an attractive price point," said Philip Petursson, chief investment strategist at IG Wealth Management.

The consumer discretionary sector was among the biggest gainers on the Toronto market, advancing 2.5%, while industrials rose 1.5% and technology ended 2.7% higher.

The energy group gave back some recent gains, falling 1.4% along with lower oil prices, while the materials group, which includes precious and base metals miners and fertilizer companies, lost 1.3%.

"With the IMF coming out and cutting its growth forecasts that seems to be weighing on oil prices today and energy stocks as a result of that," Petursson said.

The International Monetary Fund slashed its forecast for global economic growth by nearly a full percentage point, citing Russia's invasion of Ukraine, and warning that inflation was now a "clear and present danger" for many countries.

(Reporting by Fergal Smith; Additional reporting by Amal S in Bengaluru; Editing by Will Dunham)

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