12:13 PM EDT, 07/11/2024 (MT Newswires) -- The Toronto Stock Exchange is up 120 points with most sectors higher after easier than expected U.S. CPI opens the door for a rate cut, possibly in September.

The exchange is back to within 100 points of the all time record high of 22,555, achieved in May.

The biggest gainers are telecoms and utilities, up 1.6% and 1.2%, respectively.

Offsetting gains are declines in info tech (-0.4%) and miners (-0.6%).

Oil prices rose early on Thursday as a smaller than expected rise in U.S. consumer prices last month buoyed hopes for interest-rate cuts from the Federal Reserve and offset a bearish demand forecast from the International Energy Agency (IEA).

Gold traded at a seven-week high, spiking back above the US$2,400 mark for the first time since May 22 on the U.S. consumer prices data, sending the dollar and yields sharply low on expectations will soon be ready to cut interest rates.

In terms of rates, RBC said the bottom line is that a second U.S. CPI downside in a row in June has added to market odds for a first rate cut from the Federal Reserve this September. It noted that this is also building on a weaker round of employment data last week that showed persistent unwinding in tight labour market conditions. "From the Fed's perspective, these are all data prints that they would like to see at this stage to confirm that interest rates are working to cool inflation pressures sustainably and to realize their dual mandate. Powell has always communicated the Fed's decision making as a risk-management process, but also reiterated in his congressional testimony this week that there are downside risks to the economy and labour market from rates being restrictive for too long." After today's CPI report, RBC thinks an interest rate cut at the Fed's next meeting in July is still unlikely but the odds are tilting towards a September cut.

Bottom line for BMO, the CPI inflation report for June "extends and solidifies the moderation trend" in the second quarter following the disappointing readings at the start of the year. The bank said it will keep Chair Powell's dovish slant in this week's Humphrey-Hawkins testimony alive and "materially improves" the chances the FOMC actually pulls the trigger on their first rate cut in September with more to follow.