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TSX Down In Negative Territory As U.S. Jobs Data Fuels Aggressive Rate Hike Fears

Canadian stocks are exhibiting some weakness around noon on Friday, weighed down by concerns the Federal Reserve might aggressively tighten its policy after data showed employment in the U.S. jumped by much more than expected in the month of July.

Meanwhile, data released by Statistics Canada showed the Canadian economy shed 30,600 jobs in July of 2022, largely missing market expectations of a 20,000 rise and extending the 43,200 drop from the previous month.

The unemployment rate in Canada came in unchanged at 4.9% in July, the lowest on record and below market expectations of 5%.

Data from the Labor Department showed non-farm payroll employment in the U.S. spiked by 528,000 jobs in July after surging by an upwardly revised 398,000 jobs in June.

Economists had expected employment to climb by about 250,000 jobs compared to the addition of 372,000 jobs originally reported for the previous month.

With the stronger than expected job growth, the unemployment rate unexpectedly edged down to 3.5% in July from 3.6% in June. The unemployment rate was expected to remain unchanged.

Investors are also reacting to a slew of earnings announcements from Canadian companies.

The benchmark S&P/TSX Composite Index, which dropped to a low of 19,443.34, is down 116.27 or 0.59 19,460.77 a few minutes before noon.

Telus Corporation (T.TO) reported a net profit of $498 million for the quarter ended 30 June 2022, compared with a net profit of $344 million a year ago. The stock is down by about 0.8%.

Telus International (Cda) Inc. (TIXT.TO) is gaining about 2% after reporting second-quarter net income of $56 million, compared with $16 million in the same quarter last year.

Premium Brands Holdings Corporation (PBH.TO) shares are down 1.7%. The company reported record second quarter adjusted EBITDA of $130.8 million, representing a 16.6%, or $18.6 million, increase as compared to the second quarter of 2021.

Canopy Growth Corp. (WEED.TO) is down nearly 7% after the company reported that its first-quarter net loss attributable to the company was C$2.08 million or C$5.23 per share, compared to net income of C$0.39 million or C$0.84 per share in the prior-year quarter.

TransAlta Corp (TA.TO) reported net loss of $80 million or $0.30 per share for the second quarter, compared to net loss of $0.04 per share in the year-ago quarter. The stock is down more than 5%.

Ritchie Bros Auctioneers (RBA.TO) is down more than 7% after reporting a 12% drop in net income in the second quarter, compared to a year ago.

Open Text Corporation (OTEX.TO) is declining 5% despite reporting a 27.8% increase in GAAP-based net income in the fourth quarter of fiscal 2022, compared to the fourth quarter of the previous financial year.

TC Energy (TCRP.TO), Kinaxis Inc (KXS.TO), Constellation Software (CSU.TO), Alimentation Couche-Tard (ATD.TO), Cargojet (CJT.TO) and Fairfax Financial Holdings (FFH.TO) are down 2 to 6%.

Thomson Reuters (TRI.TO), Franco-Nevada Corp (FNV.TO), George Weston (WN.TO) and FirstService Corporation (FSV.TO) are also sharply lower.

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