Canada's main stock index opened lower on Monday, dragged down by a slump in shares of pot producer CannTrust Holdings and as worries that a prolonged U.S.-China trade dispute will lead the global economy into recession kept investors on edge.
The S&P/TSX Composite resumed its downward momentum, fading 41.71 points to 16,299.63
The Canadian dollar added 0.09 cents to 75.65 cents U.S.
On a day bereft of macroeconomic figures came word that Air Canada has raised the value of its offer to buy Canadian tour operator Transat AT Inc to about $720 million, or $18 per share, from its earlier offer of $13 a share.
Shares in the Maple Leaf Airline lost $1.59, or 3.6%, to $42.91.
CannTrust shares backed off 98 cents, or 23.3%, to $3.23.
Great Pacific Capital Corp has offered to take private Canadian integrated forest products company Canfor Corp at $16 per share, or about $2 billion overall, payable in cash. Canfor shares catapulted $6.26, or 71.1%, to $15.06.
Cormark Securities cut the target price on Algoma Central by two dollars to $17.00. Algoma Central shares were static at $12.86.
CIBC cut the rating on Cervus Equipment to neutral from outperform. Cervus shares hesitated 32 cents, or 3%, to $10.24.
RBC raised rating CES Energy Solutions to outperform from sector-perform. CES increases a penny per share to $2.00.
ON BAYSTREET
The TSX Venture Exchange fell 3.51 points to 592.82, for a loss on the week of just less than three points, or 0.5%
Eight of the 12 Toronto subgroups remained negative on the day, as materials sank 1.7%, health-care ailed 1.6%, and consumer discretionary stocks faded 1.2%,
The four gainers were led by energy, up 0.7%, information technology, better by 0.4%, and utilities, inching up 0.2%.
ON WALLSTREET
Stocks fell on Monday as the intensified Hong Kong protests soured investor sentiment already aggravated by the trade dispute between Washington and Beijing.
The Dow Jones Industrials dumped 182.14 points to 26,105.30
The S&P 500 stepped back 18.79 points to 2,899.86
The NASDAQ faltered 63.43 points, to 7.895.71
Losses accelerated in morning trading after Hong Kong International Airport cancelled all departures for the remainder of the day, citing serious disruptions due to intensifying protests.
Trade bellwether Caterpillar fell more than 1%, while Google’s parent Alphabet and Amazon both fell more than 1%.
In corporate news, Bloom Energy and Tencent Music will report their latest results after market close.
The escalated U.S.-China trade war rattled the markets last week with the Dow posting a loss of 0.75%. Major stock averages suffered their worst days of the year on Aug. 5 after China allowed its currency to drop against the dollar below a key level unseen since 2008.
The intensified tensions caused Goldman Sachs to lower its fourth-quarter growth forecast by 20 basis points to 1.8% as the firm no longer expects a trade deal before the 2020 election.
Bank of America on Monday raised chance of a recession to more than 30% in the next 12 months as the firm believes many economic indicators are "flashing yellow."
The People’s Bank of China on Monday set its daily midpoint for yuan trading at 7.0211 per dollar, the third consecutive session below the psychological level of seven per dollar. It was also weaker than Friday’s session, but beat market expectations.
On the data front, the federal budget for July is expected to be published at around 2 p.m. ET.
Prices for the benchmark 10-year U.S. Treasury sprang to life, felling yields to 1.68% from Friday’s 1.72%. Treasury prices and yields move in opposite directions
Oil prices gained 26 cents to $54.76 U.S. a barrel.
Gold prices picked up $7.70 to $1,516.20 U.S. an ounce.
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