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CANADA STOCKS-Toronto index falls for second day as energy shares slide

reuters.com · 06/09/2022 10:12
CANADA STOCKS-Toronto index falls for second day as energy shares slide

Updates prices, adds analyst comments

By Amal S

- Canada's resources-heavy main stock index was set to extend losses on Thursday as a slight pullback in oil prices pressured energy shares, while worries around stubborn inflation and the aggressive interest rate hikes weighed on sentiment.

At 9:45 a.m. ET (13:45 GMT), the Toronto Stock Exchange's S&P/TSX composite index .GSPTSE was down 111.58 points, or 0.54%, at 20,680.85.

The energy sector .SPTTEN dropped 1.4% as U.S. crude CLc1 prices were down 0.7% a barrel, while Brent crude LCOc1 lost 0.4%. O/R

Healthcare .GSPTTHC shares slipped 2.2%, with pot stocks including Canopy Growth CGC, Tilray Brands TLRY, Aurora Cannabis ACB down between 2.03% and 3.47%.

Earlier in the day, the European Central Bank confirmed it would end a long-running bond-buying scheme on July 1 and signaled a string of interest rate hikes.nF9N2UZ02K

The focus now shifts to U.S. inflation data due on Friday, with the Federal Reserve expected to continue with its 50 basis points rate increases at its meeting next week and again in July. nL1N2XN28A

"I think that (the drop in Canadian shares) is probably a reaction maybe to the reality sinking in that interest rates are on the rise everywhere and that the outlook for stock markets generally will remain subdued," said Stuart Cole, the head macroeconomist at Equiti Capital.

"The ECB in a sense was the last bastion of a loose monetary policy, and now that has gone too."

The financials sector .SPTTFS slipped 0.1%, while the industrials sector .GSPTTIN fell 0.1%.

The materials sector .GSPTTMT, which includes precious and base metals miners and fertilizer companies, lost 1.3% as gold futures GCc1 fell 0.2% to $1,847.5 an ounce, while copper prices dropped on the re-imposition of some lockdown restrictions in China. GOL/ MET/L


HIGHLIGHTS

The TSX posted no new 52-week highs and six new lows.

Across all Canadian issues, there were two new 52-week highs and 42 new lows, with a total volume of 24.48 million shares.



(Reporting by Amal S in Bengaluru; Editing by Aditya Soni)

((amal.s@thomsonreuters.com;))