Stocks Fall with GDP, Oil Prices

Pan American Silver in Focus

Canada's main stock index fell on Friday as coronavirus-led shutdowns dragged the country's domestic growth in April by a record 11%, while a drop in heavyweight energy shares following weak oil prices also dented sentiment.

The S&P/TSX Composite Index dropped 93.53 points to greet noon Friday at 15,169.20

The Canadian dollar slumbered 0.14 at 72.44 cents U.S.

The largest percentage gainer on the TSX was Pan American Silver, which jumped $3.87. or 10.4% after the mining company said it would undertake an public offering of nine million common shares of Maverix Metal Inc, currently held by Pan American.

Its gains were followed by First Majestic Silver which rose $1.06, or 8.3%, to $13.90, after brokerage BMO raised price target of the stock.

Canopy Growth fell $6.54, or 21.4%, the most on the TSX, to $24.03, after the pot company reported a wider first-quarter loss.

The second-biggest decliner was Laurentian Bank of Canada, down $2.88, or 9.2%, to $28.42, after the chartered bank reported second-quarter results below analysts estimates.

On matters macroeconomic, Statistics Canada’s industrial product price index fell 2.3% in April, mostly because of lower prices for refined petroleum products., while its raw materials price index decreased 13.4%, during the same month, primarily because of a drop in crude oil prices.

Our country’s gross domestic product fell 2.1% in the first quarter, owing to reduced household spending and widespread shutdowns of non-essential businesses in March, in response to the COVID-19 pandemic.

On a monthly basis, GDP dropped 7.2% in March, the largest monthly decline since the series started in 1961, as almost all industrial sectors were down.

ON BAYSTREET

The TSX Venture Exchange added 5.46 points or 1%, to 550.88.

All but three of the 12 TSX subgroups were lower, with health-care issues plunging 8.7%, while energy stocks lost 1.9%, and financials dipped 1.7%.

The three gainers were gold, brighter by 2.2%, materials, up 1.6%, and information technology, better by 1%

ON WALLSTREET

Stocks were lower on Friday as traders braced for an upcoming news conference on U.S.-China relations from President Donald Trump.

The Dow Jones Industrials staggered 186.75 points to 25,213.89

The S&P 500 subtracted 15.21 points to 3,014.52

The NASDAQ Composite regained 8.37 points to 9,377.36.

The major averages entered the session up solidly for the week. The Dow and S&P 500 are up more than 2.7% each week to date while the NASDAQ has advanced 0.5%. That weekly advance comes as traders increase bets on a successful reopening of the economy.

Stocks are also up sharply for the month, with the Dow and S&P 500 gaining over 3% each while the NASDAQ advanced 5.2% in May.

Bank of America and Wells Fargo led bank stocks lower, falling more than 1.6% each. Citigroup lost 1.9% and JPMorgan Chase dipped 1.7%.
Salesforce issued disappointing guidance for the second quarter. The company expects earnings ranging between 66 cents a share and 67 cents a share. Analysts expected earnings guidance of 74 cents per share. Salesforce shares dropped 4.7%.

The major averages entered the session up solidly for the week. The Dow and S&P 500 are up more than 2.7% each week to date while the NASDAQ has advanced 0.5%. That weekly advance comes as traders increase bets on a successful reopening of the economy.

Stocks are also up sharply for the month, with the Dow and S&P 500 gaining over 3% each while the NASDAQ advanced 5.2% in May.

Trump said Thursday afternoon he would hold the news conference, knocking stocks down from solid gains. That announcement came after China approved a national security bill for Hong Kong that experts warn could endanger the city’s “one party, two systems” principle.

That principle allows for additional freedoms that mainland China residents don’t have. However, there was no time scheduled for the news conference on Friday.

Prices for the 10-Year Treasury gained ground, lowering yields to 0.66% from Thursday’s 0.69%. Treasury prices and yields move in opposite directions.

Oil prices slipped 19 cents to $33.52 U.S. a barrel.

Gold prices jumped $24.20 to $1,752.50 U.S. an ounce.