Toronto’s S&P/TSX in­dex reg­is­ters big­gest one-day loss in five months


Canada’s largest stock mar­ket racked up its big­gest one-day loss in five months Fri­day as a broad-based de­cline across all sec­tors and dis­ap­point­ing cor­po­rate earn­ings pulled the com­mod­ity-heavy in­dex lower.

The Toronto Stock Ex­change’s S&P/ TSX com­pos­ite in­dex plunged 247.73 points or 1.57 per cent to 15,533.47, with en­ergy, con­sumer staples and con­sumer dis­cre­tionary stocks bear­ing the brunt of the slump.

The last time the TSX reg­is­tered a loss of such mag­ni­tude was in Septem­ber, when it fell 248.04 points.

In­vestors have been grow­ing in­creas­ingly con­cerned the an­tic­i­pated out­comes of U.S. Pres­i­dent Don­ald Trump’s pol­icy prom­ises may not pan out, said Todd Mat­tina, chief econ­o­mist at Macken­zie In­vest­ments.

“The mar­kets are con­tin­u­ing to wait and see, look­ing for more clar­ity from Pres­i­dent Trump about his eco­nomic pack­age,” Mat­tina said. “Es­pe­cially the tim­ing and size of his tax cuts, es­pe­cially how Pres­i­dent Trump in­tends to pay for those tax cuts.”

North Amer­i­can stock mar­kets have been buoyed since the U.S. elec­tion in mid-Novem­ber by ex­pec­ta­tions Trump will fol­low through with cam­paign prom­ises of dereg­u­la­tion, low­er­ing cor­po­rate taxes and en­gag­ing in mas­sive in­fras­truc­ture spend­ing - which would be a boon for in­dus­tries such as bank­ing and man­u­fac­tur­ing.

Last week, indices in Toronto and New York ral­lied to all-time record highs for sev­eral con­sec­u­tive days, only to pull back this week.

Some of the weight from the TSX could also be at­trib­uted to the re­lease of higher-than-an­tic­i­pated in­fla­tion fig­ures. Statis­tics Canada said the an­nual in­fla­tion rate was 2.1 per cent, mainly due to an in­crease in trans­porta­tion costs. The over­all rate was stronger than De­cem­ber’s rate of 1.5 per cent.

A batch of cor­po­rate earn­ings also played their part in bring­ing down the TSX.

Magna In­ter­na­tional (TSX:MG) tum­bled 4.68 per cent, or $2.77, to $56.43 af­ter the auto parts maker re­ported low­erthan-ex­pected quar­terly profit amid higher costs.

Husky En­ergy (TSX:HSE) fell 5.49 per cent or 90 cents to $15.50 as the oil pro­ducer re­ported its lat­est re­sults. Canada’s big­gest fi­nan­cial in­sti­tu­tion, Royal Bank (TSX:RY) fell 1.68 per cent, or $1.65, to $96.61 even though the com­pany beat mar­ket fore­casts.

Mean­while, Wall Street fin­ished in the pos­i­tive af­ter be­ing neg­a­tive through­out most of the ses­sion.

The Dow Jones in­dus­trial av­er­age was ahead 11.44 points at 20,821.76 and the S&P 500 was up 3.53 points at 2,367.34. The tech-heavy Nas­daq com­pos­ite rose 9.8 points at 5,845.31.

In cur­ren­cies, the Cana­dian dol­lar was slightly higher, up 0.03 of a U.S. cent at 76.28 cents US.

Global stocks fell Fri­day, amid wor­ries about the po­ten­tial im­pact of U.S. trade poli­cies and as in­vestors be­came more cau­tious about the mar­ket’s re­cent rally.

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