Canada's main stock index fell in early trade on Wednesday, as investors were skeptical about U.S. President Donald Trump's stimulus plan to combat the economic impact of coronavirus, while oil stocks took a beating from weak crude prices.
The TSX Composite Index resumed its downward posture, demurring 359.1 points, or 2.4%, to 14,598.99
The Canadian dollar was unchanged from Tuesday’s close at 72.82 cents U.S.
Kirkland Lake Gold will shut two gold projects in Australia's Northern Territory by the end of the month, after it deemed its operations surplus sufficient. The miner’s stocks dipped three cents to $43.88.
Brookfield Asset Management has put the $2-billion sale or potential listing of its coal export terminal in Australia on hold due to travel restrictions amid the spread of coronavirus. Brookfield shares descended $1.74, or 2.2%, to $76.26.
RBC cut the price target on Air Canada to $46.00 from $58.00. The Maple Leaf airline saw its shares drop $2.23, or 8.1%, to $28.69.
National Bank of Canada raised the rating on Mullen Group to outperform from sector perform. Mullen increased nine cents, or 1.4%, to $6.50.
JP Morgan cut the target price on Suncor Energy to $33.00 from $43.00. Suncor shares cratered $1.62, or 5.8%, to $26.12.
ON BAYSTREET
The TSX Venture Exchange slouched 3.31 points to 461.43.
All 12 TSX subgroups moved into the red, with energy falling 3.8%, financials poorer by 2.5%, and industrials weaker 2.4%.
ON WALLSTREET
Stocks plummeted on Wednesday in another volatile session as Wall Street worried about a possible fiscal stimulus package aimed at curbing slower economic growth due to the coronavirus outbreak.
The Dow Jones Industrials thundered lower 784.42 points, or 3.1%, to 24,233.74.
The broader S&P 500 backed down 73.13 points, or 2.5%, to 2,809.43
The NASDAQ dumped 178.25 points, or 2.1%, to 8,167.53.
Those losses put the three averages closer to entering bear-market territory. The Dow was 17.9% below its all-time high set last month while the S&P 500 was 17.5% below its record. The NASDAQ traded 17.4% below an all-time high set on Feb. 19.
President Donald Trump suggested Tuesday a 0% payroll tax rate that could last until the end of the year. However, the timing of such policies being implemented remains uncertain.
Trump’s comment came as the number of coronavirus cases around the world total more than 100,000, according to data from Johns Hopkins University. In the U.S. alone, more than 1,000 cases have been confirmed. This increase in cases added to fears of a global economic slowdown and have increased calls for government intervention.
The uncertainty around fiscal stimulus, coupled with a reduction in travel demand and rising coronavirus cases, pressured airline and cruise line stocks. American, Delta, United and JetBlue all fell more than 3%. Norwegian Cruise Line gave back 7.9% and Carnival eased 5.2%.
Prices for the 10-Year U.S. Treasury lost ground, raising yields to 0.71% from Tuesday’s 0.63%. Treasury prices and yields move in opposite directions.
Oil prices fell $1.04 to $33.32 U.S. a barrel.
Gold prices picked up $2.10 to $1,662.40 U.S. an ounce.
U.S. Stocks Tumble Yet Again on Uncertainty
