Canadian Shares Down Firmly In Negative Territory On Virus, Rate Concerns

The Canadian market is down sharply on Monday, with stocks, except those from the healthcare sector, reeling under a severe bout of selling pressure.

The market is weighed down by worries about rapidly surging coronavirus cases across the world, and uncertainty about interest rate hikes.

Technology stocks are the worst hit. Several stocks from industrials, consumer discretionary and energy sectors are also down sharply.

The benchmark S&P/TSX Composite Index, which tumbled to 20,790.89 earlier, is down 203.72 points or 0.97% at 20,880.73 about twenty minutes before noon.

The Capped Information Technology Index is down as much as 3.3%. Docebo Inc (DCBO.TO), Nuvei Corp (NVEI.TO) and Shopify Inc (SHOP.TO) are down 7%, 6.4% and 5.2%, respectively. Lightspeed Pos (LSPD.TO), Hut 8 Minig Corp (HUT.TO), Descartes Systems Group (DSG.TO), Converge Technology Solutions (CTS.TO), Enghouse Systems (ENGH.TO), Kinaxis Inc (KXS.TO) and Tecsys Inc (TCS.TO) are down 3 to 5%.

Ats Automation (ATA.TO), down 7.2%, is the biggest loser in the Industrials Index. Ballard Power Systems (BLDP.TO) is declining 5.5%, while Tfi International (TFII.TO), Richelieu Hardware (RCH.TO), Lion Electric (LEV.TO), WSP Global (WSP.TO) and Stantec Inc (STN.TO) are lower by 3 to 4%.

Consumer discretionary shares Aritzia Inc (ATZ.TO), Spin Master Corp (TOY.TO), Brp Inc (DOO.TO), Park Lawn Corp (PLC.TO), Canada Goose Holdings (GOOS.TO) and Mty Food Group (MTY.TO) are declining 2.7 to 4.4%.

Among energy stocks, Canadian Natural Resources (CNQ.TO), Baytex Energy Corp (BTE.TO), Cenovus Energy (CVE.TO), PrairieSky Royalty (PSK.TO) and Enerplus Corp (ERF.TO) are down 1 to 2%.

According to reports, the overall number of coronavirus cases is fast approaching 307 million with the spread of the Omicron variant of the virus across the globe.

On the interest rate front, the first U.S. rate hike could be in March, with Goldman expecting the Fed to raise borrowing costs at least four times by the end of 2022 versus the previous prediction of three rate hike.

The inflation data due later in the week as well as the Fed Chairman Jerome Powell's testimony in the Senate are likely to provide additional clues about the central bank's stance on rate hikes.

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