Gains in energy stocks helped buoy Canada's main stock index Tuesday, while U.S. markets also rose, as investors in both countries await big economic news Wednesday.

Trading on Tuesday was the calm before the storm, with markets ticking upwards ahead of inflation data to be released in the U.S. and a central bank meeting in Canada, said Anish Chopra, managing director with Portfolio Management Corp.

The S&P/TSX Composite Index was up 56.11 points, 0.28 per cent, at 19,878.56.

In New York, the Dow Jones Industrial Average was up 317.02 points at 34,261.42. The S&P 500 Index was up 29.73 points at 4,439.26, while the Nasdaq Composite was up 75.22 points at 13,760.70.

Wednesday will see the latest inflation print in the U.S., ahead of the Federal Reserve’s next interest rate decision later in July.

“It’s another data point for them to think about before their meeting,” said Chopra.

Economists expect inflation will have continued to moderate, but it’s not the only thing the central bank is looking at as it weighs where to take rates next.

With data showing the labour market is still strong, a rate hike in July is likely regardless of what the inflation release shows, said Chopra. But it’s what comes after July that’s less certain, he said.

“The Fed’s really concerned about the fact that inflation could get embedded in the economy, especially as it relates to wages.”

On the other side of the border, the Bank of Canada is widely expected to announce another rate hike Wednesday, said Chopra.

Canada’s in a similar boat to its U.S. neighbours, he said, with a robust job market despite inflation moderating in certain areas.

Oil put on another strong showing Tuesday, hovering near US$75 a barrel.

“If you look at some of the demand forecasts, they're just showing higher potential for future demand in oil,” said Chopra.

That’s despite the ongoing weakness in China’s economy, he said, noting that recent supply cuts are helping prop up the price of crude.

The August crude contract was up US$1.84 at US$74.83 per barrel and the August natural gas contract was up six cents at US$2.73 per mm/BTU.

The Canadian dollar traded for 75.41 cents U.S. compared with 75.28 cents U.S. on Monday.

The August gold contract was up US$6.10 at US$1,936.00 an ounce and the September copper contract was down two cents at US$3.77 a pound.

This report by The Canadian Press was first published July 11, 2023.