Stocks Come off Morning Lows

Artis, MEG in Focus



Stocks in Toronto fell on Tuesday, hurt by a slide in oil prices on coronavirus-led demand worries and a tech-fueled slide on Wall Street.

The TSX picked came off its lows of the morning, but still trailed Friday’s close by 88.56 points to approach noon EDT Tuesday, to 16,129.45

The Canadian dollar dumped 0.47 cents to 75.39 cents U.S.

Markets across North America were shuttered Monday for Labour Day.

The largest percentage gainers on the TSX were real estate stocks Artis Real Estate Investment Trust, which jumped 39 cents, or 4.4%, to $9.28, and Summit Industrial Income REIT, improving 18 cents, or 1.5%, to $11.97.

MEG Energy fell 36 cents, or 10.5%, the most on the TSX, to $3.08, while the second biggest decliner was Vermilion Energy, down 38 cents, or 8.2%, to $4.26.

ON BAYSTREET

The TSX Venture Exchange erased 7.47 points, or 1%, to 726.22.

The 12 TSX subgroups were split down the middle, with consumer staples gaining 0.5%, while industrials and materials were up 0.3% each.

The half-dozen laggards were weighed most heavily by energy, down 5.5%, while financials and tech stocks each dropped 1.1%.

ON WALLSTREET

Stocks fell sharply on Tuesday to start the week as technology shares were under pressure following their worst sell-off in more than five months last week.

The Dow Jones Industrials remained sharply lower, 510.29 points, or 1.8%, to 27,623.02.

The S&P 500 fell 73.73 points, or 2.2%, to 3,353.23.

The NASDAQ Composite stumbled 331.43 points, or 2.9%, to 10,981.70.

Tesla plunged 14% after the S&P Dow Jones Indices failed to add the surging and speculative stock to the S&P 500 after the bell Friday.

Investors were betting on inclusion of the stock into the S&P 500, hoping for the stamp of approval on the rally by S&P. The snub shows the risks to the overheating Nasdaq trade.

Other hot NASDAQ stocks were hit hard. Facebook, Amazon, Microsoft, and Google-parent Alphabet were all down more than 2%. Apple was down 2.7%, but pared some of its losses after the tech giant announced an event on Sept. 15 where it is expected to unveil new iPhones. Zoom Video fell by 2.9%.

Shares of Softbank dropped 7% on Monday in Japan as it was identified as the big options buyer making a bet in the billions on tech stocks continuing to surge. The tech trade could lose some of its firepower if Softbank were to curb those bets.

Semiconductor stocks were under pressure amid simmering U.S.-China trade tensions. Nvidia and Micron both fell 1.8%. Applied Materials dropped more than 6%. Advanced Micro Devices pulled back by 1.5%.

Many on Wall Street believe the weakness derived from worries that the massive tech run-up pushed valuations to unsustainable levels. Even with last week’s pullback, the NASDAQ is up more than 70% from its March bottom.

Geopolitical developments also weighed on investor sentiment Tuesday. China accused the U.S. of “bullying” as it launched a global data security initiative on Tuesday.

That came as Washington continues to pressure China’s largest tech firms and convince countries around the world to block them. President Donald Trump also recently entertained the idea of "decoupling" from China, or refusing to do business with the country.

Prices for the 10-Year Treasury sank, raising yields to Friday’s 0.68%. Treasury prices and yields move in opposite directions.

Oil prices slumped $3.32 to $36.45 U.S. a barrel.

Gold prices squeezed 40 cents higher to $1,934.70 U.S. an ounce.