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Inflation Hits Canada Metals, Mining Stocks, Erasing 2022 Gains

  • S&P/TSX Composite Materials’ returns now negative for the year
  • ‘This is a bit of an unprecedented cycle,’ Stifel says

Canadian mining, metals and lumber stocks dropped Wednesday, wiping out their 27% gain for this year as hotter-than-expected inflation, rising interest rates and slowing global growth weigh on the companies.

The S&P/TSX Composite Materials Index is now negative for the year after peaking in mid-April, when Russia’s invasion of Ukraine sent prices for commodities and natural resources soaring. Since then, the Bank of Canada has implemented its biggest interest rate increase in decades with a half-a-percentage-point hike on April 13, preceding a similar move by the US Federal Reserve.