TSX Pointed Downward

Health-care, Energy Issues Chief Anchors

Equities in Toronto fell for a second day on Monday, hit by losses in shares of pot producer CannTrust Holdings and worries over recession due to a prolonged U.S.-China trade war.

The S&P/TSX Composite remained negative 35.25 points to greet noon at 16,306.09

The Canadian dollar subtracted 0.06 cents to 75.51 cents U.S.

CannTrust Holdings tumbled $1.05, or 24.9%, to the bottom of the main stock index at $3.16, after Health Canada found fault with cannabis production at a second facility.

The health-care index fell with other weed companies such as Canopy Growth off 15 cents to $43.24, Cronos Group down 35 cents, or 2%, to $17.33, and Aurora Cannabis falling 13 cents, or 1.5%, to $8.48

Among the bright spots were shares of material companies, helped by a gain of 31 cents, or 1.3%, in Barrick Gold to $24.27, after it reported quarterly adjusted profit that nearly doubled on higher production.

Shares of tour operator Transat AT jumped over $4.68, or 39.7%, to $16.47, after Air Canada raised the value of its offer to buy the company to about $720 million, or $18 per share, from its earlier offer of $13 a share. Air Canada's shares were down 58 cents, or 1.3% to $43.92.

The biggest percentage gainer on the main index was a 72.4% jump in integrated forest products company Canfor Corp to $15.17 after Great Pacific Capital Corp offered to take the company private at $16 per share, or about $2 billion overall.

ON BAYSTREET

The TSX Venture Exchange recovered 3.39 points to 596.21,

Seven of the 12 Toronto subgroups remained negative approaching the noon mark, as energy fell 1.6%, health-care docked 0.9%, and financials were poorer by 0.6%

The five gainers were led by gold, up 1.3%, materials, better by 1.2%, and consumer staples, ahead 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 stumbled 244.13 points to 26,043.31

The S&P 500 stepped back 21.71 points to 2,896.94

The NASDAQ stayed in the red 47.59 points, to 7,911.55

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.

In corporate news, Bloom Energy and Tencent Music will report their latest results after market close.

Trade bellwethers Caterpillar and Boeing both fell more than 1%, while Google’s parent Alphabet both fell 0.9%. Retailers, who are targeted in the latest round of China tariffs, are under pressure as Office Depot tanked 5% while Macy’s and Nordstrom both slipped 2%

Bank stocks declined as interest rates dived. Bank of America and Goldman Sachs both dropped more than 2%, while J.P. Morgan slid 1.6%.

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 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 1.66% from Friday’s 1.72%. Treasury prices and yields move in opposite directions

Oil prices gained 13 cents to $54.76 U.S. a barrel.

Gold prices picked up $8.30 to $1,516.20 U.S. an ounce.