Skip to content

S&P/TSX composite down, led by energy and base metals; U.S. markets also in the red

TORONTO — Canada's main stock index moved lower on Monday, dragged down by losses in energy and base metals, while U.S. markets also ended the day in the red, led by weakness on the Nasdaq.
2023120411124-656df8ff750b316f61822e79jpeg
The Bay Street Financial District is shown with the Canadian flag in Toronto on Friday, August 5, 2022. THE CANADIAN PRESS/Nathan Denette

TORONTO — Canada's main stock index moved lower on Monday, dragged down by losses in energy and base metals, while U.S. markets also ended the day in the red, led by weakness on the Nasdaq.  

After a strong November as rate hike pressures eased, with some of the big tech names posting strong performances, traders are taking stock of the sentiment shift, said Kevin Burkett, portfolio manager at Victoria-based Burkett Asset Management.

“I think what we’re just seeing is a bit of a short-term reversal of some of the big moves we’ve seen in the last couple of weeks,” he said. 

A similar shift is evident in the bond market, added Burkett. 

“Some of the rapid fall in rates that drove bond prices higher for the month of November ... it seems some of those have kind of given back a little bit today.” 

The S&P/TSX composite index closed down 42.66 points at 20,410.21.

In New York, the Dow Jones industrial average was down 41.06 points at 36,204.44.The S&P 500 index was down 24.85 points at 4,569.78,while the Nasdaq composite was down 119.54 points at 14,185.49.

Investors are placing bets on rate cuts that Burkett thinks are too optimistic, with some calling for cuts as soon as the first quarter of 2024, he said. 

“To me, that seems crazy, given all the things that the Fed and Bank of Canada have been saying over the last year.”

For cuts to come as soon as some currently expect them to, the economy would likely have to be at the start of a hard landing, said Burkett. 

He thinks those expectations will have to be pushed down the road moving into the new year. 

The Bank of Canada’s upcoming rate decision Wednesday is all but certain to be a continuation of its pause, said Burkett. The U.S. Federal Reserve will hold its meeting the following week. 

The Canadian dollar traded for 73.85 cents US compared with 74.04 cents US on Friday.

Oil prices continued to fall Monday amid renewed concerns about demand as the economy weakens, said Burkett. 

The January crude oil contract was down US$1.03 at US$73.04 per barrel and the January natural gas contract was down 12 cents at US$2.69 per mmBTU.

The February gold contract was down US$47.50 at US$2,042.20 an ounceand the March copper contract was down 10 cents at US$3.84 a pound.

This report by The Canadian Press was first published Dec. 4, 2023.

Companies in this story: (TSX:GSPTSE, TSX:CADUSD) 

Rosa Saba, The Canadian Press

push icon
Be the first to read breaking stories. Enable push notifications on your device. Disable anytime.
No thanks