Stocks Feeling Pain at Open

Tesla in Focus


Equities in Toronto opened lower on Monday, hurt by declines in the financial and consumer staples sectors, but energy stocks helped cap losses on higher crude prices.

The TSX Composite fell 131.03 points to begin Monday at 20,354.63.

The Canadian dollar slipped 0.28 cents to 74.09 cents U.S.

Arizona Metals and Evertz Technology are among the firms in Canada reporting earnings Monday.

Arizona handed back 13 cents, or 3.2%, to $3.94, while those for Evertz dipped 12 cents to $12.63.

The BoC will decide on interest rates on Wednesday, with traders pricing in a 73.6% chance of a dialed-down 25-bps hike to 4%, after the central bank had surprised markets with a 50-bps increase last month.

The aggressive rise in borrowing costs had triggered concerns about an economic slowdown, with the commodity-heavy TSX index down 3.5% year-to-date and bond markets showing deep yield curve inversions - a harbinger for recession.

The BoC has forecast that growth would stall from the fourth quarter of this year through the middle of 2023.

On the economic slate, Statistics Canada said building permits Canada declined 1.4% in October to $10.0 billion. Losses in the residential sector more than offset gains from the non-residential sector.

ON BAYSTREET

The TSX Venture Exchange faltered 3.74 points to 595.46.

Eight of the 12 subgroups lost ground in the first hour, with gold and information technology stocks each diving 1.6%, and materials moving lower 1.4%.

The four gainers were led by health-care, progressing 2.2%, while energy picked up 0.6%, and communications, ahead 0.5%.

ON WALLSTREET

Stocks fell Monday on fears that the Federal Reserve may continue tightening until it steers the economy into a recession.

The Dow Jones Industrials withered 251.52 points to 34,178.36.

The S&P 500 subtracted 41.22 points, or 1.9%, to 4,030.48.

The NASDAQ dropped 130.73 points to 11,330.77.

In other news, Tesla shares slumped on reports of an output cut at its Shanghai factory, while Macao-linked casino stocks gained on hopes of easing COVID-19 restrictions.

Investors are looking ahead to next week’s Federal Reserve interest rate decision at the conclusion of the central bank’s December policy meeting.

Following a speech last week by Fed Chairman Jerome Powell, markets largely expect the central bank will app

A hotter-than-expected reading of November ISM Services further fueled concerns that the Fed will continue hiking. The index posted a 56.5% reading, topping the Dow Jones estimate of 53.7% and increasing from October.

Prices for the 10-year Treasury lost ground, raising yields to 3.61% from Friday’s 3.56%. Treasury prices and yields move in opposite directions.

Oil prices increased $1.10 to $81.08 U.S. a barrel.

Gold prices plummeted $22.10 to $1,787.50 U.S. an ounce.