Equities in Canada’s largest centre opened lower on Thursday, dragged by energy shares, on fears of a recession after the U.S. Federal Reserve raised interest rates for the first time in nearly three decades.
The S&P/TSX discarded Wednesday’s gains and started off Thursday in the red 352.51 points, or 1.8%, to begin Thursday at 19,259.05.
The Canadian dollar retreated 0.37 cents to 77.30 cents U.S.
Canadian National Railway said on Wednesday the union representing about 750 workers in the country could potentially go on a strike on June 18. CN shares toppled $1.21 to $141.00.
CIBC cut the target price on AGF Management to $7.25 from $8.50. AGF stepped back 21 cents, or 3.3%, to $6.21.
CIBC cut Guru Organic Energy to a neutral rating. Guru sprinted ahead 47 cents, or 4.8%, to $10.23.
ATB Capital Markets cut the rating on Hexo Corp. to underperform from sector perform. Hexo shares lost a penny, or 3.7%, to 26 cents.
On the economic front, Statistics Canada reported wholesale trade fell 0.5% in April to $79.8 billion, the second decrease in the past three months.
ON BAYSTREET
The TSX Venture Exchange swooned 8.32 points, or 1.6%, to 647.33.
All 12 TSX subgroups were in the hole in the first hour, weighed most by energy, down 3.2%, while consumer discretionary and health-care stocks each fell 2.7%.
ON WALLSTREET
The Dow Jones Industrial Average tumbled below the key 30,000 level on Thursday as investors worried the Federal Reserve’s more aggressive approach toward inflation would bring the economy into a recession.
The 30-stock index stumbled 705.45 points, or 2.3%, to commence trading Thursday at 29,963.08, after the Fed announced its largest rate hike since 1994, but reversed those gains and then some on Thursday, tumbling to the lowest level since January 2021.
While 30,000 isn’t necessarily a technical level for the Dow, these round 1,000-point thresholds are seen by many on Wall Street as key psychological levels for the market.
The S&P 500 ditched 113.67 points, or 3%, to 3,676.32.
The NASDAQ Composite retreated 393.93 points, or 3.6%, to 10,705.22.
It's been a rough week, the Dow entering Thursday’s session down 4.5%, while the S&P has lost 5.7% and the NASDAQ gave up 5.6%, for the week and well below record levels.
Data out Thursday further indicated a dramatic slowdown in economic activity. Housing starts dropped 14% in May, topping the 2.6% decline expected by economists polled by Dow Jones.
Home Depot, Intel, Walgreens, JPMorgan, 3M, and American Express hit new 52-week lows amid growing recession fears while tech shares dropped after a bounce on Wednesday.
Tesla, PayPal, Nvidia, Amazon and Netflix all slipped more than 3%. Travel stocks including United, Delta and Carnival also took a leg lower.
Treasury prices capsized, raising yields to 3.41% from Wednesday’s 3.28%. Treasury prices and yields move in opposite directions.
Oil prices fell back $2.02 to $113.29 U.S. a barrel.
Gold prices acquired $10.30 to $1,829.90 U.S. an ounce.
Dow Crumbles 700+ in First Hour.
