The “September Swoon” appears to have arrived early this year with major North American stock markets under pressure in August.
Month-to-date, stock market returns are negative both in Canada and in the U.S. The S&P/TSX Composite Index and S&P/TSX SmallCap Index have declined 3.5 per cent and 3.6 per cent, respectively. South of the border, the S&P 500 has fallen 3.3 per cent, the Dow Jones Industrial Average is down 1.7 per cent and the Nasdaq has tumbled 5 per cent.
On Tuesday, Canada’s inflation rate came in hotter-than-expected, rising 3.3 per cent in July, above the Street’s forecast of 3 per cent and up from 2.8 per cent reported in June. CPI-trim and CPI-median were both in line with expectations at 3.6 per cent and 3.7 per cent, respectively. With inflation remaining well above the Bank of Canada’ 2-per-cent target, markets are now pricing in a 29 per cent probability that the Bank of Canada will raise rates on September 6, according to Refinitiv, and a 53 per cent probability of a rate hike on October 25.
It’s important to note that high target prices, which imply stellar returns that seem unbelievable may be just that - unrealistic. At times, when a stock price falls analysts may maintain their bullish expectations, inflating the forecast return. In addition, an outlier can skew the average target price, to the upside or downside, particularly when the number of analysts covering a stock is low.
Nigeria Nigeria Latest News, Nigeria Nigeria Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Source: globeandmail - 🏆 5. / 92 Read more »
Source: globeandmail - 🏆 5. / 92 Read more »