TSX, U.S. markets retract as Fed hikes rates for the first time this year

TORONTO _ North American stock indexes were lower this afternoon after the U.S. Federal Reserve announced it was hiking interest rates for the first time this year.

The Toronto Stock Exchange’s S&P/TSX composite index was down 72.17 points at 15,313.10, shortly following the decision at 2 p.m. ET.

In New York, the Dow Jones industrial average lost 7.54 points to 19,903.67 and the S&P 500 slipped 4.65 points to 2,267.0. The Nasdaq composite edged down 10.96 points to 5,452.87.

Wall Street had been trading sideways for most of the day as the markets awaited the announcement.

The U.S. central bank says it’s raising its key interest rate by
a quarter point to a range of 0.5 to
0.75 per cent due to strong signs of a growing economy and
expectations for higher inflation.

The Fed also signalled that there will be as many as three rate increases in 2017.

It’s the first time it has touched the rate since December 2015, when it raised it from a record low near zero set during the 2008 financial crisis.

In currencies, the Canadian dollar was at 75.56 cents US, down 0.58 of a U.S. cent.

The January crude contract slipped $1.82 cents to US$51.16 per barrel and January natural gas advanced six cents to $3.54 per mmBTU.

The February gold contract lost $5 to US$1,154 an ounce and March copper contracts dipped a penny to US$2.59 a pound.