Canada's main stock index fell at Monday’s open as fears mounted after the fast-spreading coronavirus forced countries to lock down and heightened fears of a global recession.
The TSX Composite Index dropped 37.07 points to begin the week at 11,814.74
The Canadian dollar strengthened 0.18 cents at 69.34 cents U.S.
Miner Newmont Corp said it was withdrawing its 2020 outlook as some production could be deferred to 2021 due to the ongoing coronavirus outbreak. Newmont hiked $2.73, or 4.7%, to $60.48.
The spreading coronavirus outbreak will trigger a short, sharp global recession this year before the world's economy bounces back in 2021, Canada's trade financing agency predicted on Monday.
Ecuador said on Sunday that its largest gold and copper mines would reduce the number of workers and scale back operations to a minimum as the country registers a rapid growth of coronavirus infections.
National Bank of Canada cut the target price on Altagas Ltd. to $17.00 from $26.00. Altagas fell $1.03, or 8.6%, to $10.98.
National then cut the target price on Capstone Mining to $0.45 from $1.00. Capstone shares docked 1.5 cents, or 4.1%, to 35 cents.
National also cut the target price on Enbridge to $56.00 from $62.00. Enbridge shares dipped nine cents to $36.96.
On the economic slate, Statistics Canada reported that wholesale trade increased for a second consecutive month, up 1.8% to $65.2 billion in January.
ON BAYSTREET
The TSX Venture Exchange gave back 3.58 points to 352.96
The 12 TSX subgroups were evenly divided, as gold hiked 5.8%, materials climbed 3.6%, and industrials increased 1.1%.
The half-dozen laggards were weighed most by real-estate, down 3.9%, utilities faded 2.2%, and energy crawled 2% lower.
ON WALLSTREET
Stocks fell on Monday even after the Federal Reserve unveiled new measures to keep markets working properly. Wall Street awaited Washington lawmakers to agree to an economic stimulus and rescue plan to cushion the blow from the coronavirus outbreak
The Dow Jones Industrials slumped 228.45 points, or 1.2%, to 18,945.53. The 30-stock average also hit its lowest level in three years
The broader S&P 500 fell 32.75 points, or 1.4%, to 2,271.62.
The NASDAQ dropped 1.95 points to 6,877.56.
Boeing shares rose 4.6%, outperforming the market, as Goldman Sachs made a bold call Sunday evening, telling clients the company had enough cash to survive the coronavirus downturn and that air travel would eventually return. The shares are off 70% this year.
One of the measures taken by the Fed was an open-ended asset purchase program, which the central bank will run in the "amounts needed to support smooth market functioning and effective transmission of monetary policy to broader financial conditions and the economy."
A fiscal stimulus bill failed a key procedural Senate vote Sunday as Democrats warned the measure did not do enough to help impacted workers and instead offered too much for company bailouts. House Speaker Nancy Pelosi had signaled she was not on board with the Republican version of the stimulus plan, saying: "From my standpoint, we’re apart.”"
On a positive note, Senate Minority Leader Chuck Schumer said disagreements over the bill could be overcome in the next 24 hours. A spokesman for Schumer later added the senator and Treasury Secretary Steven Mnuchin had a “productive meeting.”
Prices for the 10-Year U.S. Treasury gained ground, lowering yields to 0.77% from Friday’s 0.88%. Treasury prices and yields move in opposite directions.
Oil prices picked up 28 cents to $22.91 U.S. a barrel.
Gold prices increased $46.80 to $1,530.70 U.S. an ounce.
