Major Losses on All N. American Markets
Equities in Canada’s largest centre dropped without a parachute Wednesday, as investors awaited the outcome of a crucial debate on a sweeping U.S. tax bill and further trade developments.
The TSX Composite Index flopped 216.46 from Tuesday’s all-time high to conclude Wednesday at 25,839.17.
The Canadian dollar recovered 0.25 cents at 72.15 cents U.S.
Canada's big banks are bracing for trade uncertainty and are expected to have shored up loan loss reserves in the second quarter, with four of the big six banks putting aside over $1 billion.
Markets are also monitoring the Group of Seven finance ministers' meetings currently underway in Canada for any hints that a weaker dollar could help advance trade negotiations.
In corporate news, Brookfield has received a binding bid for its student accommodation platform Livensa from Spain's Bankinter, for what would be one of the largest deals in the sector in recent years. Brookfield shares lost $3.13, or 3.8%, to $78.97.
Elsewhere, Canada Goose's shares jumped $2.37, or 19.1%, to $14.79, after the luxury retailer reported strong quarterly sales.
Health-care stocks were hit the hardest, as Bausch Health Companies bent 28 cents, or 4.3%, to $6.22, while Tilray dipped two cents, or 3.2%, to 61 cents.
So far as tech stocks went, Shopify got bruised $6.21, or 4.2%, to $141.82, while Quarterhill lost six cents, or 4%, to $1.44.
In real-estate, Colliers International demurred $9.42, or 5.4%, to $165.46, Canadian Apartment REIT units faltered $1.55, or 3.6%, to $41.71.
Gold and materials stocks tried to even things out, as NGEx Minerals moved up $!.92, or 15.7%, to $14.12, while shares in Orla Mining grabbed 90 cents, or 6.8%, to $14.19. Aya Gold improved 61 cents, or 5.5%, to $11.69, while Wesdome Gold climbed 83 cents, or 4.7%, to $18.41.
On the economic slate, Statistics Canada’s new housing price index for April declined 0.4%, compared to an unchanged reading in March.
ON BAYSTREET
The TSX Venture Exchange tumbled 14.06 points, or 2%, to 678.68.
All but two of the 12 subgroups were in the red Wednesday, with health-care stumbled 2.8%, information technology slipped 2.1%, while real-estate lost 1.9%.
Materials gained 1.5%, while gold hiked 1.3%.
ON WALLSTREET
Stocks sold off on Wednesday, pressured by a sharp spike higher in Treasury yields as traders grew worried that a new U.S. budget bill would put even more stress on the country’s already large deficit.
The Dow Jones Industrials cratered 816.8 points, or 1.9%, to 41,860.44
The S&P 500 tumbled 95.85 points, or 1.6%, to 5,844.61.
The NASDAQ Composite plunged 270.07 points, or 1.4%, to 18,872.64.
The 30-year Treasury bond yield last traded around 5.08%, the highest level going back to October 2023. The benchmark 10-year Treasury note yield traded at 4.59%.
Long-dated bonds sold off as traders worried a new budget bill would worsen the U.S. deficit. The measure is expected to pass as lawmakers reach a compromise on state and local tax deductions heading into Speaker Mike Johnson’s Memorial Day deadline. Yields spiked even higher after a poor afternoon auction for 20-year debt, raising fears investors may be losing their appetite for funding America’s deficits.
Target shares dropped 5.2% after the big box retailer cut its full-year sales outlook, with executives citing tariff uncertainty and a backlash to the company’s pullback in diversity, equity and inclusion efforts.
UnitedHealth was the worst-performing Dow member, losing 5.8% following a downgrade from HSBC. Major tech-related stocks Apple and Amazon also dropped as rates increased.
Wednesday’s action comes after a tough session for the three major averages. The S&P 500 ended a six-day win streak, while the NASDAQ saw its first negative day in three.
The latest moves come as traders look to Washington as Republican leaders work to finalize a budget bill that would lower taxes.
However, the measure has faced pressure from GOP members looking for higher deductions on state and local taxes. Investors also worry the measure could worsen the U.S. deficit.
Prices for the 10-year Treasury subsided Wednesday, lifting yields to 4.6% from Tuesday’s 4.48%. Treasury prices and yields move in opposite directions.
Oil prices lurched lower 68 cents to $61.35 U.S. a barrel.
Prices for gold hiked $37.10 to $3,321.70.
