TSX futures gain as Fed reaffirms inflation fight; gold rises

Kitco Media
By Reuters
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Reuters
TSX futures gain as Fed reaffirms inflation fight; gold rises teaser image

Sep 17 (Reuters) - Futures tracking Canada's blue-chip stocks rose on Thursday, in line with global markets, after the US Federal Reserve reiterated its focus on combating ​inflation, with rising gold prices lending further support.

September futures on ‌the S&P/TSX index were up 0.7% at 05:57 am ET (0957 GMT).

The Fed raised its key interest rate for the first time in over three years on Wednesday and signaled ​more hikes this year to fight stubbornly high inflation in the ​economy.

Still, global markets saw sharp gains on Thursday, with Asian stocks ⁠broadly higher, Europe's STOXX 600 (.STOXX), up 0.5% and S&P 500 futures ​rising 0.8%.

Charu Chanana, chief investment strategist at Saxo, said the markets were seeing ​a "credibility-relief" trade after Fed reinforced its commitment to reining in inflation.

Markets are pricing in about a 53% chance of another rate hike at the Fed's October meeting, per CME ​Group's FedWatch tool.

Gold gained on Thursday after hitting a near six-week low in ​the previous session, while copper prices also inched up.

On Thursday, oil prices eased as Saudi ‌Arabia's ⁠supplies calmed concerns, though prices remained above $100 a barrel due to fears of a wider Middle East conflict.

Canada's producer prices data is scheduled for later on the day, with markets awaiting clues on inflation trends.

Bank of Canada Governor ​Tiff Macklem said ​on Wednesday inflation ⁠is likely to remain elevated in the near term and reiterated the central bank's readiness to raise rates if price ​pressures persist.

The TSX closed at its lowest level since ​July 31 ⁠on Wednesday, weighed down by declines in commodity-linked stocks.

Canadian Prime Minister Mark Carney is set to address the European Parliament on Thursday, amid tensions with Washington over ⁠the ​EU's plans to grant Canada associate member ​status.

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Reporting by Darshan Kumar in Bengaluru; Editing by Vijay Kishore

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