Canada's main stock index opened lower on Friday, extending previous session's decline, as signs of credit stress at U.S. regional lenders sparked concerns.
The TSX watched its losing streak lengthen, falling 231.93 points to 30,226.87.
The Canadian dollar inched up 0.004 cents to 71.20 cents U.S.
Still, the TSX appeared positioned to register modest weekly gains, buoyed by its commodity-heavy composition and a record rally in gold prices. The materials sector has led the charge with an 8.6% increase this week.
The Canadian dollar nosed ahead 0.04 cents to 71.23 cents U.S.
Prime Minister Mark Carney on Thursday brushed off calls to retaliate against the U.S. over its tariffs on some Canadian exports, saying the two countries were deep in talks over key sectors.
In corporate news, U.S.-listed shares of Bitfarms tumbled 16.3% in premarket trading after pricing $500 million in convertible senior notes due 2031.
Bitfarms shares paled 52 cents, or 7%, to $6.89.
In the economic docket, Statistics Canada said foreign investors acquired $25.9 billion of Canadian securities in August, led by purchases of debt instruments. Meanwhile, Canadian investors added $19.5 billion of foreign securities to their portfolio, led by investment in shares
ON BAYSTREET
The TSX Venture Exchange collapsed 37.32 points, or 3.7%, to 970.04.
The 12 TSX subgroups were split, with gold stumbling 5.4%, materials off 4.5%, and health-care fading 1.1%.
The half-dozen gainers were led by consumer staples, up 0.4%, while industrials and information technology each picking up 0.3%.
ON WALLSTREET
The Dow Jones Industrial Average was up slightly on Friday as traders tried to move past credit concerns that sparked a big selloff in regional banks Thursday.
The 30-stock index had gained 38.45 points to 45,990.69.
The S&P 500 dipped 0.28 points to 6,628.79.
The tech-heavy NASDAQ shed 21.62 points to 22,540.92.
Stocks remain on track for weekly gains despite Thursday’s decline. The S&P 500 is up 1% after a strong start to the third-quarter earnings. The Dow has added about 1.3% week to date, while the NASDAQ has gained 1.4%.
Stocks that led Thursday’s bank sell off were rebounding, as Wall Street defended the shares and traders bet any bad credit bets were one-offs and not part of a bigger crisis. Zions and Western Alliance disclosed bad loans over the last 48 hours, which sparked a big selloff in the stocks that eventually dragged down the whole market Thursday. Zion lost 13%, while Western Alliance tanked by 11% Thursday.
But Zions Bancorp climbed more than 2% Friday after receiving an upgrade from Baird, which said the drop in market value for the regional bank was out of proportion considering the size of loan losses it was potentially facing. Investment bank Jefferies, caught in the storm for its exposure to bankrupt auto parts retailer First Brands, was last up 3% after Oppenheimer raised its rating to outperform. Jefferies was down 11% Thursday.
Better-than-expected earnings Friday from Fifth Third Bancorp also assuaged worries, sending the stock higher by 2%. The bank’s profit jumped last quarter even after posting a jump in credit losses tied to exposure to bankrupt subprime auto lender Tricolor.
Prices for the 10-year Treasury fell back, raising yields to 4.01% from Thursday’s 3.97%. Treasury prices and yields move in opposite directions.
Oil prices inched back three cents to $57.43 U.S. a barrel.
Gold prices jumped $54.70 to $4,251.20 U.S. an ounce.
