Canadian Stocks See Further Downside Amid Ongoing Interest Rate Concerns

(RTTNews) – Canadian stocks moved notably lower over the course of the trading day on Wednesday, extending the downward trend seen over the past few sessions.

The benchmark S&P/TSX Composite Index slumped 182.09 points or 0.9 percent to 19,330.81, its lowest closing level in a month.

The continued weakness on Bay Street reflected lingering concerns about higher interest rates and the impact on the global economy.

In remarks earlier this morning, Cleveland Federal Reserve President Loretta Mester said she expects U.S. interest rates to be raised above 4 percent by early next year.

Mester also said she does not anticipate the Federal Reserve cutting interest rates in 2023, with the Fed likely to keep rates at an elevated level in an effort to combat inflation.

Gold stocks came under pressure over the course of the session, dragging the S&P/TSX Global Gold Index down by 1.3 percent.

The weakness in the gold sector came as the price of the precious metal fell to its lowest levels in over a month, with gold for December delivery slipping $10.10 to $1,726.20 an ounce.

Telecom, financial and energy stocks also moved to the downside on the day, while health care stocks bucked the downtrend, resulting in a 3.9 percent spike by the S&P/TSX Capped Health Care Index.

On the economic front, Statistics Canada released a report this morning showing real gross domestic product rose by 0.8 percent in the second quarter.

Canadian GDP grew for the fourth consecutive quarterly, reflecting increased business investment in inventories, non-residential structures, machinery and equipment, and household spending on services and semi-durable goods.

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