Energy Stocks Shine In Canadian Market; BoC Raises Interest Rate

(RTTNews) - Canadian stocks are turning in a mixed performance on Wednesday with investors digesting the Bank of Canada's announcement of a 25-basis point rate hike, in addition to tracking corporate earnings news and the trend in commodities markets.

Energy stocks are up, riding on firm crude oil prices. Technology stocks are gaining ground tracking the rally in U.S. tech stocks amid renewed optimism surrounding AI. Materials and real estate stocks are showing weakness.

The benchmark S&P/TSX Composite Index is down 43.52 points at 36,127.97 a little over an hour before noon.

The Canadian central bank, which left interest rates unchanged for seven consecutive meetings, today announced its widely expected decision to raise rates by a quarter point.

The central bank said it decided to increase its target for the overnight rate by 25 basis points to 2.5%, with the Bank Rate at 2.75% and the deposit rate at 2.45%.

The Canadian central bank's Governing Council said the rate hike is intended to reduce the risk that continuing high energy prices spread broadly to the prices of other goods and services.

The BoC also said there could be a need for further rate increases but agreed to proceed carefully due to elevated uncertainty.

Meanwhile, the Canadian central bank said economic growth is expected to slow in the fourth quarter of 2026 due to new U.S. tariffs before picking up again in 2027.

Energy stocks Enerflex, Baytex Energy, Vermilion Energy, Spartan Delta Corp., Prairiesky Royalty, Birchcliff Energy, Kelt Exploration, Ces Energy Solutions, Suncor Energy, Baytex Energy, Ensign Energy Services and Cenovus Energy are up 1.5%-2%.

Technology stock Celestica is up 4.3%, extending previous session's gains on strong results. Constellation Software, Descartes Systems Group, Firan Technology Group, Tecsys, Docebo Inc., Shopify and Kinaxis are up 0.7%-1.3%.

Among notable gainers from other sectors, Bausch Health Companies is up 4.3%. Trican Well Service, Precision Drilling, Aecon, Element Financial, Brookfield Infrastructure Partners, Badger Infrastructure Solutions, Canfor and Interfor are up 1.3%-3%.

Transcontinental is down more than 6%. Tilray, Canada Goose Holdings, Ivanhoe Mines, Novagold Resources, Chartwell Retirement Residences, TFI International, Dundee Precious Metals, First Quantum Minerals, Lundin Mining, Gildan Activewear, Ero Copper and Silvercorp Metals are down 2%-3%.