12:32 PM EDT, 05/21/2024 (MT Newswires) -- The TSX, which reached a record intraday high of 22,500, has given up all its gains and is down 25 points at midday. Miners and energy are the biggest gainers, up 0.9% and 0.8%, respectively.

Healthcare and telecoms are the biggest decliners, down 1.6% and 0.9%, respectively.

Oil prices weakened for a second day early on Tuesday, though were sticking within the tight range maintained since the start of the month on steady demand and a dimming outlook for interest-rate cuts from the Federal Reserve.

Gold traded lower, falling off a record high as the dollar rose.

Natural gas prices dropped off a four-month high on a rally that pushed the price of the fuel up by 71% since an April 26 low on expectations summer heat will boost cooling demand while export demand is on the rise.

Market focus here was very much on the Canada CPI data for April, as market watchers looked for more clarity around expectations that the Bank of Canada has room to start cutting rates next month.

According to CIBC Economics, today's data "should have provided the all clear on the inflation front that the Bank of Canada needed" to start cutting interest rates in June. While headline CPI was in line with consensus expectations, rising 0.5% NSA on the month for an annual rate of 2.7%, CIBC noted we saw continued softness in most core measures of inflation including CPI-Trim and CPI-median which "should be enough" to bring a first interest rate cut in June.

CIBC noted while gasoline prices rose during the month, the continued easing in food price inflation meant that headline annual CPI increased 2.7% on a year-over-year basis, down from 2.9% in the prior month. On a seasonally adjusted monthly basis, food prices actually fell by 0.2%, and the annual inflation rate in that category now stands below the overall pace of CPI inflation at 2.3%. (edited)

CIBC said: "At the time of the April interest rate decision, the Bank of Canada Governor stated that policymakers were encouraged by recent subdued inflation readings, but needed those to persist for longer before cutting interest rates. Since then we have received two more months of data pointing to tame underlying inflation, for a total of four in a row, and as such there doesn't appear to be a good reason not to cut interest rates at the next meeting in June. We continue to forecast a first reduction at that meeting, with a total of four 25bp cuts before the end of the year."

For RBC Economics, the Bottom Line is that April's inflation readings largely met expectations, but with underlying details -- including further slowing in the BoC's preferred 'core' measures -- pointing to further reduction in inflationary pressures. RBC noted the BoC is as concerned about where inflation will go in the future as where it is right now, but said a persistently softer economic backdrop in Canada (declining per-capita GDP and rising unemployment rate) increases the odds that price growth will continue to slow. RBC added the case for interest rate cuts from the Bank of Canada continues to build, with today's report in line with its own base case for a first cut in June.