Stock markets in Canada closed down on Tuesday, replicating movements in global stock markets, alongside weaker energy stocks.
Canada’s main stock index, the S&P/TSX Composite Index, closed down 0.4% at 16,336 points, with the energy sector leading the way, down 0.8%. The financials sector dropped 0.6% and the industrials sector fell 0.3%.
Top detractors included Encana Corp (TSE:ECA), which slipped 4.5% at C$9.24.
The TSX Venture Exchange was down 0.6% to close at 628.59 points.
The Canadian Securities Exchange was down 3.7% at 866.76 points.
Global markets
In the US, stocks spent bell-to-bell in negative territory Tuesday, snapping an 8-day winning streak for the S&P 500 Index.
Job openings decreased in February by 7% to just under 7.1 million, below the consensus range of between 7.1 million and 7.6 million, according to the Bureau of Labor Statistics’ JOLTS report. February’s total is the lowest since March 2018. Hires also fell 2.3% to 5.7 million.
Investors suddenly have another potential trade war to worry about wary of another trade war after President Trump threatened the EU with $11 billion in tariffs on Twitter Tuesday morning.
Bank of America, which reports next week, announced Tuesday that it would be raising its minimum wage to $20 per hour over a two-year period. Its stock is paying a price, down nearly 1%.
The Dow dropped 0.7%, 190 points, to close at 26,150.6, the Nasdaq slipped 0.6% to finish at 7,909.3 and the S&P 500 receded 0.6% to end the day at 2,878.2.
At the small-cap level, the Russell 2000 closed 1% lower at 1,563.3, while the S&P 600 saw a 1.1% decline to 953.7.
1:30pm: Canadian markets continue to lose ground in afternoon trading
The TSX continued to lose ground on Tuesday midday, falling an additional 86 points to hit 16,322.
The Venture exchange also lost 0.5% to sit at 629 points.
The Canadian Securities Exchange lost an additional 2.3% to hit 880 points as cannabis shares performed poorly to start the week.
Midday movers on the Venture exchange were Liberty Defense Holdings Ltd (CVE:SCAN), which acquired Gulfstream Acquisition 1 Corp in a reverse merger transaction at the beginning of April. Shares rocketed up 195% by mid-Tuesday.
Auralite Investments Inc (CVE:AAAA) moved around 20% downwards, as did Pond Technologies (CVE:POND), down around 11%
10:30: Canadian markets open weaker amid concerns over economic growth and the loonie
Canada’s main stock exchanges showed signs of weakness on Tuesday after the International Monetary Fund cut Canada’s growth forecast nearly half a percentage point to 1.5% in its most recent World Economic Outlook.
The loonie also came under fire on Tuesday for its inability to keep pace with the rally in crude oil prices earlier this year, with Societe Generale strategist Kit Juckes calling it “the world’s most frustrating currency” in a recent report, according to BNN Bloomberg.
The TSX struggled the most out of the three exchanges, down 0.6% in early Tuesday trading to 16,311.
The TSX Venture held steady with a slight gain of 0.1% to sit at 633 points.
The Canadian Securities Exchange was down 1.5%, or 13 points, to 887.
With no big gainers or losers on Tuesday morning, the companies leading the charge into positive territory were largely resource shares. Auryn Resources Inc (TSE:AUG) was up almost 5%, while Endeavour Mining Corporation (TSE:EDV) and NuVista Energy Ltd (TSE:NVA) rose around 3% and 2%, respectively.
Endeavour Mining just began production at its fourth gold mine in West Africa, adding nearly 200,000 ounces of gold to its output.
On the flip side, energy shares were down, with Calfrac Well Services Ltd (TSE:CFW), Westport Fuel systems Inc (TSE:WPRT) and Encana Corp (TSE:ECA) all losing between 4% and 5%.
The feeble showing of energy shares is slightly baffling given that oil prices continued to gain overnight, reaching five-month peaks to sit at nearly US$64.
Gold is also performing well, above the US$1,300 mark for a second straight day to US$1,304.
The Canadian dollar was flat at around US$0.75.
Global markets: Wall Street opens lower as investors brace for bank earnings
The Dow lost 200 points at the open, the second day this week the industrials have struggled.
Boeing Co (NYSE:BA) and Caterpillar Inc (NYSE:CAT) each fell again, taking the blue-chip index down with them.
Traders also have an eye on the earnings reports that are due to land later this week, including reports from money-center banks such as JP Morgan Chase and Wells Fargo on Friday.
Bank of America, which reports next week, announced Tuesday that it would be raising its minimum wage to $20 per hour over a two-year period.
The Dow dropped 0.8%, 215 points, to 26,125.7, the Nasdaq slipped 0.4% to 7,925.9 and the S&P 500 receded 0.6% to 2,877.9.
In Europe, the London FTSE was down as traders waited for Brexit developments. The FTSE shaved off 0.4% to 7,419.6.
The French CAC shrank 0.6% to 5,439.3, and the German DAX slid 0.9% to 11,857.7.
8:35 am: Wall Street set to slide at the open as investors brace for bank earnings
Investors are expecting moderate losses on Wall Street Tuesday as futures trended lower across the board.
Traders are looking ahead to earnings reports that drop later this week, including reports from money center banks such as JPMorgan Chase & Co (NYSE:JPM) and Wells Fargo & Company (NYSE:WFC) on Friday.
Bank of America Corp (NYSE:BAC), which reports next week, announced Tuesday that it would be raising its minimum wage to $20 per hour over a two-year period.
Dow futures traded 25 points lower at 26,309, Nasdaq futures dlipped 10 points to 7,614.9 and S&P 500 futures fell 3 points to 2,894.8.
In Europe, the London FTSE was nearly flat as a steady pound and a desire by traders to wait for Brexit developments held the 100-stock index in place. The FTSE shaved off 7 points to 7,444.8.
The French CAC held at 5,472.1, and the German DAX slid 0.3% to 11,931.2.
In Asia overnight, Japan’s Nikkei 225 gained 0.2% to close at 21,802.6, while the Shanghai Composite Index slid 0.2% to 3,239.7.
Andrew Kessel also contributed to this report
Contact Angela at angela@proactiveinvestors.com
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