By Fergal Smith
TORONTO (Reuters) – Canadian stocks and bonds rallied on Wednesday, while the loonie weakened to a near two-week low against its U.S. counterpart, after the Bank of Canada became the first central bank among G7 countries to cut interest rates, raising prospects for Canada’s economy.
The Toronto Stock Exchange’s S&P/TSX composite index was up 101.63 points, or 0.5%, at 22,079.81, clawing back some losses since the start of the week.
The Canadian central bank lowered its benchmark interest rate by 25 basis points to 4.75%, its first cut in four years, in a move that will ease pressure on highly indebted consumers.
“It was clearly a positive development for equity markets and bonds,” said Angelo Kourkafas, senior investment strategist at Edward Jones in St. Louis, Missouri. “It is consistent with a soft landing scenario that the Bank of Canada is willing to start (to) normalize policy while economic growth still is holding…
