TORONTO 鈥� Canada's main stock index was down more than 100 points Thursday as the price of oil weakened energy stocks amid weakness in base metals and financials, while U.S. markets were mixed. 聽
The S&P/TSX composite index was down 125.05 points at 19,580.90.
In New York, the Dow Jones industrial average was down 4.81 points at 33,946.71. The S&P 500 index was up 16.20 at 4,381.89, while the Nasdaq composite was up 128.41 points at 13,630.61.
Energy stocks weighed on the TSX Thursday as the price of oil dropped back below US$70, with the August crude oil contract down US$3.02 at US$69.51 per barrel.
鈥淭he drop is mostly caused by the hawkishness of the central banks,鈥� said Pierre-Beno卯t Gauthier, assistant vice-president of investment strategy at IG Wealth Management.
The Bank of England hiked its interest rate by more than expected, while Norway, Switzerland and Turkey also saw their rates move higher.聽
Speaking to the Senate Banking Committee Thursday, Federal Reserve chairman Jerome Powell said that while inflation has moderated, the central bank will likely raise rates at least once more this year.聽
More hikes increase the odds of recession and of slowing demand for oil, said Gauthier.聽
鈥淎ll this news is not extremely bullish for oil, and production is still quite high,鈥� he said.聽
Meanwhile, the U.S. continues to sell from its strategic reserve, adding to downward pressure, said Gauthier. The price of oil has been moving a lot but within a relatively narrow range, he said.聽
In the U.S., the Nasdaq defied trends as it moved higher despite central bank hawkishness, said Gauthier.聽
"It's breaking a trend that has been an ongoing thing for many years," he said. "So that's a new dynamic that we're seeing."聽
Amazon in particular drove the gains, he said, with the e-commerce giant鈥檚 stock price rising more than four per cent.聽
Gauthier said investors will be looking to earnings season in a few weeks, which he thinks will be interesting. He said expectations for earnings are not high, but are still higher than he would expect, which could result in some surprises for investors.聽
The Canadian dollar traded for 75.99 cents UScompared with 75.86 cents US on Wednesday.
The July natural gas contract was up a penny at US$2.61 per mmBTU.
The August gold contract was down US$21.20 at US$1,923.70 an ounce and the July copper contract was down two cents at US$3.89 a pound.
鈥� With files from The Associated Press
This report by The Canadian Press was first published June 22, 2023.
Companies in this story: (TSX:GSPTSE, TSX:CADUSD=X)
Rosa Saba, The Canadian Press
