Stocks Take Beating on First Session of December

Bombardier, Centerra in Focus

Canada's main stock index fell on Monday, tracking global stocks, as U.S. President Donald Trump decided to restore tariffs on steel and aluminum imports from Brazil and Argentina, shrugging off a jump in oil prices following strong data from China.

The TSX Composite Index shed its gains by noon Monday and dropped 87.24 points Friday’s all-time high, to 16,952.96

The Canadian dollar dropped 0.08 to 75.20 cents U.S.

The largest percentage gainers on the TSX were Bombardier, jumping five cents, or 2.5%, to $2.02, and Meg Energy which hiked seven cents, or 1.3%, to $5.61.

Centerra Gold fell $1.83, or 16.1%, the most on the TSX, to $9.53, after open pit mining operations were temporarily halted at its Kumtor gold mine in Kyrgyzstan. The second biggest decliner was Shopify, down $22.57, or 5.1%, to $422.86.

On the economic calendar, Markit Canada’s Manufacturing Purchasing Managers Index for November increased to 51.4 from 51.2 in the previous month, but below market expectations of 52.6.

Markit’s latest reading pointed to the sharpest expansion in factory activity since February, as output advanced at the fastest pace in nine months amid strong domestic demand; and the job rate rose slightly.

ON BAYSTREET

The TSX Venture Exchange gained 1.03 points midday to 534.17

All but three of the 12 Toronto subgroups had turned red by early afternoon, as information technology hurtled lower 2%, while communications dropped 0.8%, and financials were poorer by 0.5%.

Gold moved north 0.5%, and consumer discretionary surfaced by 0.2%; so much for the gainers. Materials were unchanged at noon hour.

ON WALLSTREET

Stocks dropped on Monday, the first trading day of December, as investors digested disappointing economic data along with the latest trade news after capping a month that featured blistering gains.

The Dow Jones Industrials dropped 206.28 points to break for lunch at 27,845.13

The S&P 500 fell 21.56 points to 3,119.42

The NASDAQ subtracted 88.66 points to 8,576.79

Shares of Facebook, Amazon, Alphabet and Apple all dropped more than 1%. Netflix traded 2.7% lower. Roku, which has been one of the hottest stocks of 2019, plummeted more than 15%.

Monday’s losses came after a strong performance in November. The major averages had their biggest monthly gains since June, rallying to record highs. The S&P 500 climbed 3.4% last month while the Dow advanced 3.7%. The NASDAQ rallied 4.5%.

Manufacturing activity in the U.S. continued to contract last month, the Institute for Supply Management said. The ISM Manufacturing PMI dipped to 48.1 in November. That’s below an estimate of 49.4. Stocks hit their session lows after the data was released.

Chinese state media reported Sunday that Beijing wants a cancellation of tariffs for a phase one trade deal. There is no clear indication of when both countries will be able to sign an agreement and last week saw fresh tension between Washington and Beijing after President Donald Trump signed legislation supporting protesters in Hong Kong.

Trump also said Monday he will restore tariffs on metal imports from Brazil and Argentina. In a tweet, he said: "Brazil and Argentina have been presiding over a massive devaluation of their currencies, which is not good for our farmers. Therefore, effective immediately, I will restore the Tariffs on all Steel & Aluminum that is shipped into the U.S. from those countries."

Prices for the 10-Year U.S. Treasury plummeted, raising yields to 1.83% from Wednesday’s 1.77%. Treasury prices and yields move in opposite directions.

Oil prices increased 92 cents at $56.09 U.S. a barrel.

Gold prices dwindled $3.40 to $1,469.30 U.S. an ounce.