TSX rises for third day, led by consumer-related stocks

By Khushi Singh and Fergal Smith

(Reuters) -Canada's main stock index rose on Wednesday for a third straight day as expectations the Federal Reserve would pause its interest rate hikes bolstered consumer-related stocks, but the move was not enough to lift the index out of its recent range.

The Toronto Stock Exchange's S&P/TSX composite index ended up 55.86 points, or 0.3%, at 20,278.94, adding to its gains on Monday and Tuesday.

The index has moved in a sideways pattern since notching in February its highest intraday level in eight months at 20,843.21.

Stocks on Wall Street ended mixed on Wednesday as data showing a moderate increase in consumer prices in August cemented expectations that the Fed would move to the sidelines this month.

The TSX has "recurring rotation characteristics" among its major sectors that keeps it range-bound in the short term, said Sid Mokhtari, chief market technician at CIBC Capital Markets.

"There are pockets, such as banks and telcos, that are still on the weaker side. Against it, you have energy, which is acting better."

The consumer staples sector rose 1.2% on Wednesday, while consumer discretionary was up 0.6%, helped by a gain of 5.9% for Dollarama after the discount retailer beat quarterly sales estimates.

Food and general products retailer, North West Company Inc posted strong second-quarter results. Its shares rose 14.7%.

Heavily weighted financials also gained ground, rising 0.7%. But energy gave back some recent gains, ending down 0.8%, as oil settled 0.4% lower at $88.52 a barrel.

The Toronto market "is one of the best yielding indexes out there, but if people are chasing momentum into Q4 it (performance) becomes more sector specific," Mokhtari said.

(Reporting by Fergal Smith in Toronto and Khushi Singh in Bengaluru, Editing by Tasim Zahid and Sandra Maler)