Canada's benchmark stock index finished the Tuesday trading session in the green as gains in the financial, materials and industrial subsectors offset weakness in energy stocks.

The S&P/TSX Composite Index closed 89.37 points higher, or 0.44 per cent, to 20,269.97.

Toronto-Dominion Bank, Canadian Pacific Railway Ltd. and Royal Bank of Canada added the most points to the index. 

INFLATION COOLS

Statistics Canada reported inflation cooled to 7.6 per cent in July year-over-year as gasoline prices fell by the most since the start of the pandemic.

David Rosenberg, the founder and president of Rosenberg Research, said the “odds are high” that the Bank of Canada will hike interest rates by three-quarters of a point at its next meeting.
 
“There’s nothing here, even when you look through the various components, that’s going to knock the Bank of Canada off its aggressive posture,” Rosenberg said in a TV interview on Tuesday.

It was a choppy trading session south of the border. The S&P 500 rose 0.19 per cent, the Dow Jones Industrial Average gained 0.71 per cent, while the Nasdaq fell 0.19 per cent.

According to one market strategist, an extended U.S. stock rally will depend on the U.S. Federal Reserve’s next move. 

“Central bank moves are going to have a lot of control on where markets go from here,” Kristina Hooper, the chief global market strategist at Invesco, said in a TV interview on Tuesday. 

She said she believes once the U.S. Federal Reserve pivots to a less hawkish tightening stance there will be relief in the markets. 

“I think that will take the pressure off stocks, and hopefully will help sustain the rally that we’ve seen,” Hooper said. 

Shares of Walmart finished 5.11 per cent higher at US$139.37 after the discount retailer’s profit exceeded analyst estimates in its latest quarter.

The Canadian dollar finished at 77.87 cents U.S., up 0.49 per cent.

Benchmark West Texas Intermediate fell 2.90 per cent to US$86.82 per barrel.