Stocks Fall Behind by Lunch, Despite U.S. Stimulus Hopes

Interfor, ERO in Focus


Equities in Toronto sank beneath the breakeven line by noon EDT on Tuesday even as optimism around Washington lawmakers agreeing on a U.S. stimulus deal before the presidential election offset weakness in energy shares due to lower crude prices.

The TSX dipped 15.38 points to 16,258.69.

The Canadian dollar gained 0.45 cents to 76.25 cents U.S.

The biggest percentage gainer on the TSX was lumber provider Interfor, jumping $1.08, or 7.3%, to $15.87, after TD Securities raised its stock rating, followed by Ero Copper, which rose $1.06, or 5.4%, to $20.72.

Aurora Cannabis dropped 42 cents, or 6.8%, to $5.76, and Canopy Growth fell $1.25, or 4.8%, to $24.85, the biggest decliners.

ON BAYSTREET

The TSX Venture Exchange plummeted 5.82 points to 711.99.

Seven of the 12 TSX subgroups were lower, weighed most by health-care, down 2.7%, information technology, sliding 1.3%, and communications, off 0.6%.

The five gainers were led by energy, gushing 1.1%, materials and consumer discretionary stocks, each 0.9%.

ON WALLSTREET

Stocks rose on Tuesday as a deadline for a new fiscal stimulus deal from Washington approached.

The Dow Jones Industrials recovered from Monday’s 400-point plunge, adding 179.6 points to move into Tuesday afternoon at 28,375.02.

The S&P 500 restocked 25.31 points to 3,452.23.

The NASDAQ pointed upward 68.96 points to 11,547.84.

Shares of Carnival Corp. gathered 2.1%, and American Airlines rose 1.1%. Procter & Gamble shares climbed 2.1% after the company reported sales growth of 9% for the previous quarter. The company’s earnings per share also topped analyst expectations.

Travelers, another Dow component, jumped 4.3% on the back of better-than-expected quarterly results. The company posted a profit of $3.12 per share on revenue of $7.77 billion. Analysts expected earnings of $3.03 per share on sales of $7.55 billion.

House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin "continued to narrow their differences" in a Monday afternoon phone call to discuss another stimulus package, according to Pelosi spokesman Drew Hammill. The speaker said that Tuesday is the deadline to reach an agreement before the Nov. 3 election.

Stimulus negotiations have hung over the market for months after the main provisions from the CARES Act expired at the end of July. Since then, job growth has slowed but consumer spending has continued to recover. However, some indicators have shown that savings built up by the massive economic relief package are starting to run out.

Prices for the 10-Year Treasury lost sharply, lifting yields to 0.78% from Monday’s 0.76%. Treasury prices and yields move in opposite directions.

Oil prices subtracted four cents at $40.79 U.S. a barrel.

Gold prices gained $2.90 to $1,914.60