TSX climbs 1% as miners gain, US rate-hike bets ease

Canada’s main stock index rose on Friday, helped by gains in mining stocks after weaker-than-expected U.S. jobs data lifted gold prices and reduced expectations of a near-term Federal Reserve interest rate hike.

At 10:23 a.m. ET, the Toronto Stock Exchange’s S&P/TSX composite index was up 1% at 35,333.96 points.

The materials index, which includes metal miners, led gains, rising 2.5%, with Southern Cross Gold , Wesdome Gold Mines and Americas Gold and

Silver Corp up 8.1% to 5.5% each.

“Weaker U.S. job data reduced expectations of further interest rate hikes. Lower rate expectations weaken the U.S. dollar, boost gold and benefit Canadian resource stocks,” said Matt Manara, executive vice president and portfolio manager at Avenue Investment Management.

All 10 TSX sectors were in the green, with the consumer discretionary index and the financials index advancing 1% and 0.8%, respectively.

If gains hold, the TSX is on track for a weekly rise.

A softer-than-expected U.S. jobs report on Thursday strengthened expectations that the Federal Reserve could delay any rate hikes until later in the year, while global business activity reports broadly suggested a resilient economy.

Separately, Canada’s dollar will strengthen less than previously expected over the coming year as uncertain negotiations to revise the U.S.-Mexico-Canada Agreement weigh on the domestic economy, reducing the prospects of interest rate hikes from the Bank of Canada, a Reuters poll showed.

Investors now expect the BoC to deliver at least one 25-basis-point rate cut by the end of the year, with markets also assigning some probability to a second cut.

Among individual stocks, Canada’s AtkinsRealis rose 3.2% as the firm anticipates that Turkey will complete an early review of its CANDU reactors following an information exchange later this summer, which may lead to concrete talks for a nuclear plant bid, a top company official said.