Fear gripped investors in Toronto Monday, with apprehension over the Bank of Canada’s rate move this week and whether it alone will be sufficient to stop inflation.
The TSX Composite toppled 243.4 points, or 1.2%, to end Monday at 20,242.26.
The Canadian dollar fell 0.81 cents to 73.55 cents U.S.
Tech stocks took the worst bath, with HUT 8 Mining tailing off 13 cents, or 7.8%, to $1.54, while BlackBerry chucked 42 cents, or 6%, to $6.58.
Among energy concerns, Crescent Point Energy faltered 41 cents, or 4%, to $9.84, while Enerplus dipped $1.03, or 4.2%, to $23.41.
Gold also lost luster, as OceanaGold gave back 18 cents, or 6.8%, to $2.48, while Wesdome Gold lost 60 cents, or 6.7%, to $8.37.
Utilities tried to limit the damage, as AltaGas surged 95 cents, or 4.2%, to $23.77, while Northland Power collected 51 cents, or 1.4%, to $38.19.
In communications, TELUS climbed 47 cents, or 1.6%, to $29.07, while Rogers jumped 76 cents, or 1.2%, to $63.00.
In health-care, Tilray gained 16 cents, or 2.6%, to $6.31, while Cronos Group pointed up nine cents, or 1.9%, to $4.76.
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.
Estimated motor vehicle sales in Canada for the month of October were 121,653 units, down 5.3% from an already weak October 2021.
The TSX Venture Exchange swooned 17.56 points, or 1.2%, to 581.64
All but three of the 12 subgroups lost ground by the closing bell, with information technology stocks diving 2.8%, energy declining 2.7%, and gold tumbling 2.1%.
The three gainers were utilities, up 0.7%, while communications gained 0.6%, and health-care picked up 0.2%
Stocks fell Monday on fears that the Federal Reserve may continue tightening until it tips the economy into a recession.
The Dow Jones Industrials thundered 482.78 points, or 1.4%, to 33,947.10.
The S&P 500 subtracted 72.86 points, or 1.8%, to 3,998.84.
The NASDAQ dropped 221.56 points, or 1.9%, to 11,239.94.
Tesla shares shed 6.4% on reports of an output cut at its Shanghai factory, while tech stocks like Amazon and Netflix slid more than 2% each on growth concerns. Salesforce tumbled 7.3% as it announced the departure of Slack’s CEO.
Macao-linked casino stocks gained on hopes of easing COVID-19 restrictions, while VF Corp. shares slid 11.2% after cutting its outlook.
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 approve a 0.5-percentage-point interest rate increase. That would mark a step down from a series of four straight 0.75-percentage-point hikes.
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 some ground, raising yields to 3.59% from Friday’s 3.56%. Treasury prices and yields move in opposite directions.
Oil prices sank $2.65 to $77.33 U.S. a barrel.
Gold prices plummeted $29.40 to $1,780.20 U.S. an ounce.