Markets Hit Hard as Banks Stand Pat
On a day when central banks ruled the roost, stocks felt around for the bruises Wednesday, bogged down by gold and material stocks.
The TSX Composite Index withered 170.18 points Wednesday to 27,369.70.
The Canadian dollar tunneled 0.33 cents at 72.27 cents U.S.
Resource stocks weighed most, with Hudbay Minerals cratering 97 cents, or 7.1%, to $12.62, while Endeavour Silver losing 41 cents, or 5.4%, to $7.21.
In gold issues, Aya Gold lost 69 cents, or 5.3%, to $12.10, while Torex Gold dished off $1.45, or 3.6%, to $39.23.
In the health-care field, Bausch Health Companies shed 57 cents, or 6.1%, to $8.84, while Sienna Senior Living fell 29 cents, or 1.6%, to $17.93.
Only utilities came out smiling, with Transalta poking ahead 30 cents, or 1.8%, to $16.95, while Emera jumped 76 cents, or 1.2%, to $64.96.
The Bank of Canada did as expected, holding the rate at 2.75% for a third time, reflecting a softer-than-expected impact on the Canadian economy from the trade war with the U.S., economists predict.
ON BAYSTREET
The TSX Venture Exchange dropped 7.45 points, or 1%, to 770.13.
All but one of the 12 TSX subgroups were lower Wednesday, weighed most by health-care, sliding 2.7%, gold, dulling 2.5%, and materials, off 2.3%.
Only utilities stood out against the negative tide, gaining 0.1%.
ON WALLSTREET
The S&P 500 gave up earlier gains and closed lower after Federal Reserve Chair Jerome Powell signaled the central bank isn’t ready to cut rates, as it assesses the impact of President Donald Trump’s higher tariff levels on the inflation picture.
The Dow Jones Industrial Average was thumped 171.71 points to 44,461.28.
The broader index dipped 7.96 points to 6,362.90.
The NASDAQ was positive 31.38 points to 21,129.67.
The post-Fed losses were led by consumer-focused stocks like Home Depot, which could benefit from lower rates.
Investors parsed Powell’s comments at a press conference for insights into the Fed’s next move — after it didn’t budge on rates following its July meeting. Powell said that the central bank has “made no decisions” about a potential policy change in September.
The comments poured cold water on traders hoping for a rate cut in September and at least another decrease before the year is out. Treasury yields jumped as Powell signaled it may take a bit to assess the effect of tariffs on consumer prices.
Wall Street will get more earnings after the bell Wednesday, with Meta Platforms and Microsoft set to report.
Prices for the 10-year treasury slumped, raising yields to 4.37% from Tuesday’s 4.32%. Treasury prices and yields move in opposite directions.
Oil prices advanced $1.27 to $70.48 U.S. a barrel.
Gold prices plummeted $57.50 at $3,323.70 U.S. an ounce.
