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Canopy Growth drops on convertible bonds sale
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Suncor Energy gains on naming Rich Kruger CEO
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Domestic inflation eases, retail sales rise
By Shristi Achar A Feb 21 (Reuters) - Canada's main stock index dropped on Tuesday as a rise in government bond yields dented rate-sensitive technology shares and consumer stocks tracked weak sentiment on the Wall Street, outweighing relief from easing domestic inflation.
At 10:22 a.m. ET (1522 GMT), the Toronto Stock Exchange's S&P/TSX composite index was down 166.77 points, or 0.81%, at 20,348.47. Canada's annual inflation rate eased more than expected to 5.9% in January due to a so-called base-year effect, even as food and mortgage interest costs continued to soar.
Meanwhile, Canadian retail sales rose by 0.5% in December from November on higher auto and general merchandise store sales. Sales were seen to rise by 0.7% in January.
"Canadian inflation numbers were surprisingly positive given the overwhelming negativity surrounding inflation and rising interest rates," said Brandon Michael, senior analyst at ABC Funds in Toronto. "It gives Bank of Canada (BoC) the ability to continue with their plans to pause this rate hiking cycle at their next meeting in March." Traders largely expect the BoC to hold interest rates at the same level at its next meeting. The technology sector and consumer stocks however fell 1.7% and 1.4% respectively. Canada's ten-year government bond yields rose to 3.4% on Tuesday from 3.3% in the previous session. In company news, Teck Resources Ltd slipped 0.7% after it missed fourth-quarter profit estimates and also said it would spin off its steelmaking coal unit. The miner said it will also change its name to Teck Metals Corp. Canopy Growth Corp fell 3.9% as the cannabis producer entered into a deal with an institutional investor to sell up to $150 mln of 5.0% convertible bonds (CBs) due 2028. The stock dragged healthcare sector down 2.1%. Suncor Energy Inc gained 1.3% after the company named Rich Kruger as its chief executive officer, effective April 3. Sigma Lithium Corp climbed 12.9% on a Friday report that Tesla Inc was weighing a takeover of the battery metals miner. (Reporting by Shristi Achar A in Bengaluru; Editing by Shailesh Kuber)
