Canada's main stock index fell hard on Wednesday, with technology and financial shares leading declines, as investors fretted over the prospect of aggressive policy tightening by the U.S. Federal Reserve to tackle inflation.
The TSX Composite Index let go of 163.64 points to pause for lunch at 21,767.19.
The Canadian dollar fell 0.19 cents to 79.91 cents U.S.
The financial sector fell with Bank of Nova Scotia and Toronto-Dominion Bank among the most heavily traded shares. For their part, Scotiabank shares parted with 65 cents to $88.57, while those for TD lost 59 cents to $99.60.
The largest percentage gainer on the TSX was Tilray which jumped $1.08, or 12.3% to $9.84, after cannabis producer reported a third-quarter profit vs year-earlier loss.
Shopify fell $73.47, or 8.4%, the most on the TSX, to $805.00, followed by software firm Lightspeed Commerce, down $3.28, or 8.3%, to $36.42.
The United States and its allies were set to impose fresh sanctions on Russian banks and officials and ban new investment in Russia over civilian killings in northern Ukraine, which President Volodymyr Zelenskiy described as "war crimes."
Russia denied targeting civilians.
The Kremlin said on Wednesday peace talks with Kyiv were not progressing as rapidly or energetically as it would like.
The Ford government in Ontario plans to raise the hourly minimum wage by 50 Canadian cents beginning in October, in what would be the second hike in an election year.
Economically speaking, Western University’s IVEY School of Business released its Purchasing Managers Index, which shot up in March to 74.2 from 60.6 in February, and compared favourably with the 72.9 figure in March 2021.
ON BAYSTREET
The TSX Venture Exchange stayed in the minus category, 12.35 points, or 1.4%, to 878.88.
Seven of the 12 TSX subgroups were lower Wednesday morning, with information technology down 4.5%, while consumer discretionary and real-estate stocks were each off 1.4%.
The five gainers were led by health-care, up 1.7%, gold, better by 1%, and communications, higher 0.9%.
ON WALLSTREET
Stocks dipped for a second day on Wednesday and rates soared to new heights as investors bet the Federal Reserve is about to aggressively tighten policy to fight inflation, and in turn slow the economy.
The Dow Jones Industrials tumbled 202.33 to 34,438.83.
The S&P 500 slumped 50.18 points, or 1.1%, to 4,475.04
The NASDAQ Composite fell 327.49 points, or 2.3%, to 13,876.68.
Tech shares fell again on Wednesday following Tuesday’s losses, as investors rotated out of the group and braced for higher rates to slow the economy. Apple, Microsoft, Amazon and Tesla contributed to the sector’s declines and led the NASDAQ to fall again Tuesday.
Nvidia continued its descent on Wednesday, losing 6%, while Marvell Technology collapsed 4%. As the Federal Reserve hikes rates investors have begun searching for stocks with stable profits and shying away from those offering future growth.
Meanwhile, Twitter rose 1.5%, continuing its rally amid news that Elon Musk purchased a large stake in the company.
Utilities, health care and consumer staples sectors continued to climb Wednesday, with Amgen, Merck and Johnson & Johnson all rising about 2%. Consumer staples such as Walmart, Coca-Cola and Procter & Gamble also inched slightly higher.
Investors await minutes from the Fed’s most-recent meeting slated for release Wednesday afternoon, which could impact investors’ outlook and offer new clues to the Fed’s plan to reduce its balance sheet.
It comes after comments from Fed officials knocked down stocks on Tuesday. The minutes come from last month’s meeting when the central bank raised rates and indicated six more hikes were coming this year.
Treasury prices fell as yields spiked to 2.60%, from Tuesday’s 2.55%. Treasury prices and yields move in opposite directions.
Oil prices skidded $2.55 to $99.41 U.S. a barrel.
Gold prices picked up three dollars to $1,930.50 U.S. an ounce.
