Shares of energy companies pushed Canada's main stock index lower on Monday, ahead of this week's U.S. Federal Reserve meeting where investors widely expect an interest rate cut.
The S&P/TSX Composite remained negative 20.34 points to move into noon hour at 16,510.70
The Canadian dollar regained 0.05 cents to 75.98 cents U.S.
The energy sector dropped as shares of Vermilion Energy tumbled $1.93, or 8%, to $22.36, after reporting lower production in the second quarter.
CannTrust Holdings fell 14 cents, or 4.7%, the most on the TSX to $2.87
Thomson Reuters Corp, the parent company of Reuters that holds a 45% stake in Refinitiv, fell $2.51, or 2.7%, to $90.23. London Stock Exchange said it was in talks to buy financial data firm Refinitiv, in a deal worth $27 billion including debt.
The largest percentage gainer on the TSX was Bausch Health Companies, which jumped 72 cents, or 2.3%, to $32.08, after the company said it would pay down an additional $100 million of its senior secured term loans this week, using cash flow from operations.
Gold miner Kirkland Lake Gold, which rose 96 cents, or 1.6%, to $59.64, was the second biggest gainer on the main index.
ON BAYSTREET
The TSX Venture Exchange slipped 2.97 points to 589.82
Seven of the 12 Toronto subgroups had moved into plus territory by midday, with consumer staples up 0.6%, while communications and utilities each sprang up 0.4%.
The five laggards were weighed most by information technology, down 2.2%, while health-care suffered 1.9%, and energy slid 1.8%.
ON WALLSTREET
U.S. stocks traded flat Monday as Wall Street tempered its expectations for this week’s trade negotiations between Washington and Beijing and prepared for the latest monetary policy decision from the Federal Reserve.
The Dow Jones Industrials got 45.82 points worth of momentum by noon to 27,238.27, as gains in Apple and 3M offset declines in Goldman Sachs and Boeing.
The S&P 500 dropped 6.8 points to 3,019.06, as consumer discretionary and communication services stocks weighed on the broad equity index.
The NASDAQ remained in the red 58.91 points to 8,271.30, as Amazon fell 2%, Microsoft lost 0.6% and Facebook shed 1.5%.
In corporate news, drugmaker Pfizer plans to divest its off-patent drug business and marry it with generic-drug maker Mylan. The combined company, which will market Mylan’s EpiPen and Pfizer’s Viagra, will be domiciled in the U.S.
Beyond Meat, the hot meat alternative IPO with a market cap bigger than a quarter of companies in the S&P 500, reports earnings after the bell. Seventy-five percent of companies have beaten estimates so far and 60% beat revenue expectations.
The Fed will announce its latest decision on whether to adjust interest rates at 2 p.m. ET Wednesday; Chairman Jerome Powell will also address the state of the economy in a press conference at 2:30 p.m. ET later Wednesday.
Despite a healthy economy and an unemployment rate under 4%, investors widely expect the central bank to cut its benchmark lending rate for the first time since 2008 by 25 basis points. The Fed, which seeks to keep inflation around 2%, has had trouble sustaining price growth in recent months despite a healthy economy and low unemployment.
That may hint that the current level of interest rates may be too high even though the benchmark is well below historical norms. Some economists and Fed officials think that rates need to be lowered in the face of decelerating Gross Domestic Product in the U.S. and a gloomier growth outlook overseas as Washington-led trade wars continue.
U.S. and Chinese officials will convene in Shanghai this week in a latest attempt by the globe’s two largest economies to craft a trade deal and end their year-long trade dispute.
Prices for the benchmark 10-year U.S. Treasury gained slightly, weighing yields to 2.06% from Friday’s 2.07%. Treasury prices and yields move in opposite directions.
Oil prices regained 24 cents to $56.44 U.S. a barrel.
Gold prices acquired $1.30 to $1,420.60 U.S. an ounce.
