TSX in Red by Noon Hour

Energy, Pot Stocks Scramble

Canadian stocks fell Friday, weighed by energy shares after oil prices slumped as a fresh surge in COVID-19 cases in Europe threatened to slow an economic recovery.

The S&P/TSX Composite remained negative 28.06 points by noon at 21,609.48.

The Canadian dollar dealt off 0.17 cents at 79.17 cents U.S.

Shares of Enerplus faded 74 cents, or 5.8%, to $12.04, Crescent Point Energy declined 32 cents, or 5.5%, to $5.51, and Cenovus Energy dipped 73 cents, or 4.5%, to $15.36.

Tilray enjoyed gains Friday morning, before giving up a nickel to $13.66, and Canopy Growth ditched 21 cents, or 1.4%, to $15.35. Aurora Cannabis took on 15 cents, or 1.7%, however, to $8.97.

Shares in Air Canada slipped 33 cents, or 1.4%, to $23.81, despite saying it would not need further financial support from the government, citing the airline's recovery from the COVID-19 pandemic.

On the economic slate, Statistics Canada reported retail sales were down 0.6% to $56.6 billion in September. The decline was led by lower sales at motor vehicle and parts dealers (-1.6%) as new car dealer sales (-2.8%) continued to struggle amid global supply shortages for semiconductor chips.

The agency’s new housing price index increased 0.9% in October nationally, slightly higher than the rise observed over the past four months

Prime Minister Justin Trudeau returns to Ottawa on Friday after failing to convince President Joe Biden to scrap proposed electric-vehicle tax credits that would favour U.S.-based manufacturers, but said he would keep seeking a solution.

ON BAYSTREET

The TSX Venture Exchange inched up 3.7 points to 985.18

All but three of the 12 TSX subgroups slumped by noon hour, with energy withering 3.7%, health-care wavering 0.7%, and consumer staples off 0.5%.

The two laggards were information technology, up 1.9%, and industrials, up 0.1%, while real-estate issues were unchanged.

ON WALLSTREET

Stocks were mixed on Friday as concerns over a resurgence of Covid-19 weighed on global markets, though tech shares pushed higher.

The Dow Jones Industrials came off their lows of the morning, but still trailed Thursday’s close by 172.07 points to pause for lunch Friday at 35,698.88.

The S&P 500 index regained 9.61 points to 4,714.15

The NASDAQ Composite barged ahead 115.3 points to 16,109.

So far this week, the blue chip Dow is down 1.1%, on pace for its second negative week in a row. The S&P 500 headed for a modest gains, up 0.5% this week. And the tech-heavy NASDAQ is on track to end the week 1.7% higher. The S&P 500 is striving for its sixth positive week in seven, sitting 0.1% below its all-time high.

Markets took a hit after Austria announced earlier in the day that it would re-enter a full national lockdown due to a spike in COVID cases. Germany also unveiled Thursday more restrictions for unvaccinated people, as a fourth wave sent daily cases to a record high.

Markets moved downward anyway, though the Dow pared deeper declines from earlier in the day and the S&P turned positive. Shares of air carriers were among the first to drop. United Airlines fell 3%, while United and Delta were also lower. Boeing lost nearly 5%.

Other travel stocks dropped too, with Expedia and Booking Holdings down 2% and Airbnb losing nearly 5%. Cruise lines were about 3% lower.

The decline in airline and travel stocks comes about a week after the Biden administration lifted pandemic travel restrictions that have barred many international visitors for nearly 20 months. That move was cheered by airlines and other travel companies.

Big energy companies led the declines in the S&P 500 as demand concerns related to new lockdown orders hurt oil prices, which were already in a slump. Hess and Diamondback Energy slid about 6% Friday. Marathon Oil and Devon Energy fell 5%.

Meanwhile, stay-at-home stocks moved higher. Zoom and Meta Platforms gained about 2%, while Peloton added more than 1%.

But the increase in COVID cases and new restrictions in Europe is damping hopes for an immediate rebound in trans-Atlantic travel, a usually lucrative segment that is key to large carriers’ return to profitability.

More than 90% of the S&P 500 companies have handed in their financial results for the third quarter, and over 80% of them reported earnings better than Street’s expectations. S&P 500 companies are on track to grow profit by 41.5% year over year.

Prices for 10-year Treasurys jumped, lowering yields to 1.53% from Thursday’s 1.59%. Treasury prices and yields move in opposite directions.

Oil prices hurtled lower $3.31 to $75.76 U.S. a barrel.

Gold prices skidded $2.70 to $1,858.70 U.S. an ounce.