Dec 9 (Reuters) - Canada's main stock index hit a record high on Monday, led by mining stocks, while anticipation of an interest rate cut by the Bank of Canada also lifted investor sentiment.
The Toronto Stock Exchange's S&P/TSX composite index (.GSPTSE), was up 116.01 points, or 0.45%, at 25,807.81.
Canada's materials sector (.GSPTTMT), gained 3.8% with gold climbing on China's central bank resuming bullion purchases and optimism for a U.S. rate cut in December, while copper jumped after Beijing pledged to boost its economy.
The energy sector (.SPTTEN), gained 1.4% tracking oil prices after top importer China commenced its first move toward a "moderately loose" monetary policy since 2010.
Meanwhile, traders are betting the Bank of Canada will cut the interest rate by half a percentage point on Wednesday, with prospects of a jumbo rate cut soaring after data on Friday showed Canada's jobless rate spiked to an 8-year high, excluding the pandemic period.
Advertisement · Scroll to continue
"And I think either way, whether it's a good 25 or 50 basis points, it will be a bit of a positive for the market," said Michael Sprung, president at Sprung Investment Management.
The central bank has reduced rates by 125 bps since June in light of concerns about slow growth despite inflation coming within its target range of 2%.
BRP Inc (DOO.TO), gained 4% as the power sports products company extended its gains from Friday, helping the consumer discretionary sector (.GSPTTCD), add 1.6%.
TSX is up 23.2% for the year, and with 2024 coming to an end, analysts are seeing another positive run next year.
"I think investors are literally a little overly optimistic that this could continue for a longer period of time," Sprung added, while noting that the index has had two powerful years.
Across the border, the S&P 500 (.SPX), and the Nasdaq (.IXIC), were slightly lower on Monday as investors awaited a key inflation report this week.
Reporting by Ragini Mathur in Bengaluru; Editing by Vijay Kishore
