Stocks tumbled in Canada following a much-expected move by the U.S. Federal Reserve to lower interest rates for the first time in more than a decade.
The S&P/TSX Composite fell 59.49 points to end Wednesday at 16,406.56
The Canadian dollar shelved 0.30 cents to 75.74 cents U.S.
In the gold sector, Kirkland Lake Gold docked $5.49, or 9.1%, to $54.60, taking the worst pounding. Sandstorm Gold slid 59 cents, or 6.8%, to $8.12, Kirkland Lake Gold docked $5.49, or 9.1%, to $54.60.
Elsewhere in resource stocks, MAG Silver hurtled lower $1.46, or 9%, to $14.70, while SSR Mining plummeted $1.32, or 6.1%, to $20.44
In the tech sector, the carnage was not so grim, as Photon Control fell four cents, or 3.5%, to $1.09, while CGI Group ditched $2.81, or 2.7%, to $101.57
Energy chugged along, however, with Seven Generations Energy positively cooking 89 cents, or 13.8%, to $7.35, while Kelt Exploration gained 25 cents, or 6.4%, to $4.18
In utilities, Altagas picked up 46 cents, or 2.3%, to $20.21, while Brookfield Renewable Partners LP added 20 cents to $47.35
On the economic front, Statistics Canada reported that gross domestic product was up for a third consecutive month in May, rising 0.2%.
The increase was led by a rebound in manufacturing with 13 out of 20 industrial sectors expanding.
The agency’s industrial product price index was down 1.4% in June, driven primarily by lower prices for energy and petroleum products.
Its raw materials price index decreased 5.9% in the same month, mainly due to lower prices for crude energy products.
ON BAYSTREET
The TSX Venture Exchange dropped 2.17 points to 591.66
All but three of the 12 Toronto subgroups were negative on the day, as gold went for a bath, losing 4.4%, materials clunked 2.6%, and information technology lost 0.8%.
The three gainers proved to be energy, adding 1.1%, utilities, inching up 0.1%, and consumer discretionary, squeezing ahead 0.04%.
ON WALLSTREET
Stocks dropped on Wednesday as Federal Reserve Chair Jerome Powell dampened hopes for further rate cuts later this year.
The Dow Jones Industrials tumbled 333.75 points – after spending much of the day in the green-- to 26,864.27, its biggest one-day decline since May 31 along with the S&P 500.
The S&P 500 sank 32.8 points, or 1.1%, to 2,980.38
The NASDAQ subtracted 98.19 points, or 1.2%, to 8,175.42, its biggest one-day drop since late June.
The major indexes posted solid monthly gains despite Wednesday’s drop. The S&P 500 gained 1.3%, and the NASDAQ improved 2.1%, in July. The Dow climbed 1% this month.
The Fed cut rates by 25 basis points, matching market expectations. The central bank cited “global developments” along with “muted inflation” as reasons for easing monetary conditions.
However, Powell told reporters in a news conference following rate decision that the central bank’s rate cut was a “mid-cycle adjustment,” hinting that further rate cuts later this year are not a sure thing.
Those comments sent equities to their lows of the day, led by momentum stocks such as Microsoft and Amazon.
Apple reported Tuesday evening earnings per share and revenue for the previous quarter that topped analyst expectations, sending the stock up 2% on Wednesday. The company also issued better-than-expected revenue guidance for the fourth quarter.
Nearly 60% of S&P 500 companies have reported earnings so far. Of those companies, 76% have posted stronger-than-forecast quarterly profits
Prices for the benchmark 10-year U.S. Treasury gained sharply, lowering yields to 2.01% from Tuesday’s 2.06%. Treasury prices and yields move in opposite directions
Oil prices removed 10 cents to $57.95 U.S. a barrel.
Gold prices faded $16.10 to $1,419.70 U.S. an ounce.
