Toronto stocks claw back partial gains after Monday sell-off
By Maiya Keidan
TORONTO (Reuters) - Canada's main stock index rose 0.5% on Tuesday, as gains in technology and materials helped to reverse some of Monday's losses from the collapse of Silicon Valley Bank (SVB) and Signature Bank.
The Toronto Stock Exchange's main composite index closed up 105.26 points at 19,694.16 after ending Monday down 0.9% at 19,588.90.
"I think it went too far on Monday and we've seen a partial reversal today and I think the market is trying to gauge how long-lasting this episode is, and how far reaching," said Doug Porter, chief economist at BMO Capital Markets.
"The market is still grappling with the turmoil we've seen in the financial sector and the need to still dampen down inflation through higher interest rates. The market is still a little bit unsettled."
Canada's technology sector rose 2.6% while the materials group, which includes precious and base metals miners and fertilizer companies, rose 0.9%.
Heavyweight financials, the Canadian index's biggest sector, closed 0.8% higher in a partial rebound from Monday's 2% decline.
Canada's financial regulator said on Tuesday it was boosting the frequency and intensity of monitoring of institutional liquidity after SVB's collapse.
Economists are divided on whether the Fed will hike interest rates again next week after the failure of SVB and Signature Bank. The European Central Bank is also expected to announce an important rate decision on Thursday.
Energy stocks fell 1.2% after oil prices dropped to a nine-week low on fresh concerns of reduced future oil demand.
Brent futures fell 3.9% to $77.55 a barrel, while U.S. West Texas Intermediate (WTI) crude fell 4.3% to $71.53.
Energy stocks started Tuesday's session with gains of 1.3%, after a 4.6% drop on Monday.
(Reporting by Maiya Keidan; Editing by Richard Chang)
