Canada's main stock index dropped on Monday, as elevated government bond yields dented rate-sensitive technology shares, while investor focus shifted to the Bank of Canada's interest rate meeting due later this week.
The TSX Composite fell 152,47 points to pause for lunch hour Monday at 20,333.19.
The Canadian dollar slipped 0.57 cents to 73.79 cents U.S.
Technology stocks lost ground with BlackBerry leading losses with a drop of more than 5%.
Cannabis companies Canopy Growth and Tilray Brands surged up to 6%,
AltaGas gained 5.7% after the energy company reported a higher full-year outlook.
The BoC will decide on interest rates on Wednesday, with traders pricing in a 73.6% chance of a dialed-down 25-bps hike to 4%, after the central bank had surprised markets with a 50-bps increase last month.
The aggressive rise in borrowing costs had triggered concerns about an economic slowdown, with the commodity-heavy TSX index down 3.5% year-to-date and bond markets showing deep yield curve inversions - a harbinger for recession.
The BoC has forecast that growth would stall from the fourth quarter of this year through the middle of 2023.
On the economic slate, Statistics Canada said building permits Canada declined 1.4% in October to $10.0 billion. Losses in the residential sector more than offset gains from the non-residential sector.
ON BAYSTREET
The TSX Venture Exchange swooned 7.97 points, or 1.3%, to 591.23
Eight of the 12 subgroups lost ground in the first hour, with information technology stocks diving 1.7%, and energy failing 1.1%, and materials moving lower 1%.
The four gainers were led by health-care, progressing 4.1%, while utilities picked up 0.5%, and communications, ahead 0.2%.
ON WALLSTREET
Stocks fell Monday on fears that the Federal Reserve may continue tightening until it steers the economy into a recession.
The Dow Jones Industrials withered 301.95 points to 34,127.93.
The S&P 500 subtracted 48.74 points, or 1.2%, to 4,022.96.
The NASDAQ dropped 148.35 points, or 1.3%, to 11,312.28.
In other news, Tesla shares slumped 4% on reports of an output cut at its Shanghai factory, while Macao-linked casino stocks gained on hopes of easing Covid-19 restrictions.
Restaurant stock Yum Brands could be a big winner in 2023, according to investment firm Cowen. Yum’s shares are down about 6.5% year to date, and were little changed near $130 per share on Monday morning.
Investors are looking ahead to next week’s Federal Reserve interest rate decision at the conclusion of the central bank’s December policy meeting.
Following a speech last week by Fed Chairman Jerome Powell, markets largely expect the central bank will app
A hotter-than-expected reading of November ISM Services further fueled concerns that the Fed will continue hiking. The index posted a 56.5% reading, topping the Dow Jones estimate of 53.7% and increasing from October.
Prices for the 10-year Treasury lost some ground, raising yields to 3.58% from Friday’s 3.56%. Treasury prices and yields move in opposite directions.
Oil prices sank 83 cents to $79.15 U.S. a barrel.
Gold prices plummeted $23.40 to $1,786.50 U.S. an ounce.
