Canada's main stock index reversed course to trade higher on Monday, boosted by technology and healthcare stocks, although the benchmark index was set for its worst month since September.
At 9:40 a.m. ET, the Toronto Stock Exchange's S&P/TSX composite index was up 20.85 points, or 0.1%, at 20,762.6, with technology stocks leading gains.
On a monthly basis, however, the benchmark index was set for its worst show in four months on concerns around sooner than expected rate hikes by central banks and weak tech stocks.
"It's our belief that financial markets went through a cleansing period in January, working off the over exuberance of 2021 which was characterized by overspeculation in unprofitable companies, SPACs, cryptocurrencies, and the mass participation of retail investors," said Brandon Michael, senior analyst at ABC Funds.
"We believe the current corrective phase will lead to the next leg of the secular bull market in equities."
Markets were shaken last week by hawkish signals from the Bank of Canada and the Federal Reserve, with investors now pricing in at least five Fed rate rises this year.
The healthcare sector gained 0.8% with pot producers Canopy Growth Corp, Tilray Brands Inc and Cronos Group Inc rising between 1.1% and 2.37%.
The energy sector was up 0.1% as oil prices rose amid a supply shortage and political tensions in Eastern Europe.
The materials sector, which includes precious and base metals miners and fertilizer companies, added 0.2% as gold futures rose 0.6% to $1,795.5 an ounce.
On the economic front, domestic producer prices rose for a fourth consecutive month in December, gaining 0.7% from November, Statistics Canada said.
Highlights
The TSX posted three new 52-week highs and one new low.
Across all Canadian issues there were 14 new 52-week highs and 28 new lows, with total volume of 25.67 million shares.
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