Canada's main stock index opened lower on Tuesday, led by declines in energy and material shares, while investors weighed the implications of a potential U.S. government shutdown that could disrupt critical economic data releases.
The Canadian dollar was stable at 71.85 cents.
In corporate developments, Imperial Oil said on Monday it would cut its workforce by about 20% by the end of 2027, part of a major restructuring that would eventually shutter most of its presence in Calgary.
Imperial Oil shares demurred $$3.08, or 2.4%, to $125.16.
Canadians are pausing coast to coast Tuesday to observe the Day of Truth and Reconciliation with their indigenous population.
ON BAYSTREET
The TSX Venture Exchange retreated 2.23 points to 940.61
Seven of the 12 subgroups were positive in the first hour Tuesday, led by utilities and gold, each up 0.5%, while financials took on 0.4%.
The four laggards were weighed most by energy, sputtering 1.2%, while telecoms ditched 0.8%, and health-care hesitated 0.7%. Industrial stocks were static.
ON WALLSTREET
The S&P 500 fell on Tuesday as a potential U.S. government shutdown loomed. Despite the latest declines, Wall Street was headed for an unusually strong September.
The Dow Jones Industrial Index poked up 21.44 points at 46,337.51.
The much-broader index dipped 4.69 points to 6,656.52.
The tech-heavy NASDAQ retreated 29.64 points to 22,565.33
Although shutdowns aren’t usually market-moving events, this time could be different as investors are already wary about a slowing labour market, the risk of stagflation and elevated stock valuations.
A shutdown could also prompt rating agencies to rethink the condition of U.S. credit, which was downgraded in May by Moody’s.
House Speaker Mike Johnson, said on Tuesday that he’s “skeptical” that a shutdown can be averted by the midnight deadline, saying that the outcome is in the hands of Senate Minority Leader Chuck Schumer and House Minority Leader Hakeem Jeffries, said about Republicans that “if the government shuts down, it’s their decision to do it.”
The Labor Department also announced Monday that the September nonfarm payrolls report scheduled to release Friday will not come out if the U.S. government suspends operations.
The report is one of several upcoming key data releases that will provide crucial information about the direction of the economy ahead of the Federal Reserve’s upcoming October policy meeting. Exacerbating concerns over the shutdown was President Donald Trump’s threat over the weekend that a shutdown could result in mass firings of federal workers.
Prices for the 10-year Treasury gained ground, lowering yields to 4.12% from Monday’s 4.15%. Treasury prices and yields move in opposite directions.
Oil prices shed 90 cents to $62.55 U.S. a barrel.
Gold prices skidded $1.70 to $3,853.50 U.S. an ounce.
