TSX closes near three-month low

TORONTO — Canada’s main stock market closed at a three-month low Friday amid a weak jobs report and reinforced trade concerns after the U.S. president threatened more tariffs on China.

Friday’s session was a bit of a roller coaster ride, with U.S. President Donald Trump’s statement that he’s prepared to impose tariffs on another US$267 billion in Chinese imports having a negative impact, said Cavan Yie, portfolio manager at Manulife Asset Management.

The potential tariffs would be on top of tariffs Trump has said he will slap on US$200 billion worth of goods that ignited retaliation from Beijing on U.S. goods.

“Whenever there is some uncertainty on tariffs and how much and how soon markets kind of react pretty violently,” he said in an interview.

In addition to China, uncertainty remains over NAFTA as negotiations resumed this week between Canada and the U.S. with the possibility that any deal won’t come until the end of the month.

Intensifying trade wars could potentially accelerate the inevitable end of the bull run, Yie added.

The S&P/TSX composite index closed down 10.67 points to 16,090.27, after falling to a low of 15,994.32 on 225 million shares traded. The decrease was led by base metals and telecom services sectors, which each fell by less than one per cent. Financials, health care, industrials, consumer discretionary, consumer staples and utilities were also down.

Information technology, gold, materials, energy and real estate were up on the day.

The trading week ended with a report that Canada lost 51,600 net jobs last month that drove the national unemployment rate to six per cent, up from 5.8 per cent in July.

The negative labour figures were fuelled by the loss of 92,000 part-time positions, but the creation of 40,400 full-time jobs.

In the U.S., the unemployment rate stayed at 3.9 per cent, near an 18-year low, but wages grew more than had been forecast.

In New York, the Dow Jones industrial average was down 79.33 points at 25,916.54. The S&P 500 index was down 6.37 points at 2,871.68, while the Nasdaq composite was down 20.18 points at 7,902.54.

Stronger wage growth wasn’t good for equity markets because they signalled that the Federal Reserve may need to hike interest rates faster than expected, Yie said.

The Canadian dollar was trading at an average of 75.96 cents US compared with an average of 75.83 cents US on Thursday.

The October crude contract was down two cents at US$67.75 per barrel and the October natural gas contract was up 0.4 of a cent at US$2.78 per mmBTU.

The December gold contract was down $3.90 at US$1,200.40 an ounce and the December copper contract was down 1.4 cents at US$2.62 a pound.