By Ketki Saxena
Investing.com -- At the close In Toronto, the S&P/TSX Composite was at 18,834.16points, down 1.02% in the day’s trading as worries of a global recession continue to gain momentum.
On the first day of the third-quarter U.S. trading, North American Equities turned sharply lower ahead of meeting minutes from the Federal Reserve expected Wednesday. The minutes are likely to be hawkish, given that the world’s most central bank now considers entrenched inflation to be a greater concern than the risk of a recession.
While most TSX sectors retraced intraday losses, tech and healthcare were the only subindices to eke out a substantial gain, as a continuing pullback in yields prompted dip-buying after heavy sell-off in the rate-sensitive sectors during the past weeks.
The commodity-heavy Canadian index was heavily pressured by losses in energy following a sharp decline in crude driven by recession fears. Supply concerns also eased somewhat following an abrupt end to the short-lived strikes by Norweigian oil workers. Crude oil for delivery in August fell 8.09% to hit $99.66 a barrel, while the September Brent oil contract fell 9.25% to trade at $103.00 a barrel.
Materials further weighed on the Canadian index today, following gold’s fall to nine-month lows as the safe-haven dollar gained. Gold Futures for August delivery were down 2.00% to $1,765.45 a troy ounce, while the Dollar Index hit 106.51, reaching its highest level since 2002. Materials were also pressured by a slide in copper, an industrial metal considered a bellwether of economic sentiment.
Energy stocks were the biggest losers on the TSX today, including Athabasca Oil Corp, which lost 13.41% or 0.35 points to trade at 2.26 in late trade. NuVista Energy (TSX:NVA) Ltd declined 12.49% or 1.33 points to end at 9.32 and Precision Drilling Corporation shed 12.31% or 10.24 points to 72.96.
The biggest gainers of the session were Shopify (TSX:SHOP) Inc, which rose 9.94% or 4.01 points to trade at 44.36 at the close. Bausch Health (TSX:BHC) Companies Inc added 8.16% or 0.89 points to end at 11.80 and Cronos Group (TSX:CRON) Inc was up 7.46% or 0.27 points to 3.89 in late trade.
In New York, the Dow Jones Industrial Average lost 0.42%, while the S&P 500 index climbed 0.16%, and the Nasdaq Composite index gained 1.75%.
On the first day of trading in Q3 2022, recession worries continued to drive market action, with losses in energy weighing on the commodity-heavy Dow Jones, while tech helped the S&P500 and the Nasdaq eke out a gain.
In another sign of an incoming U.S. recession, yields on the 2-year Treasury bond rose above yields 10-year Treasury note, historically a sign of a sharp economic contraction in the next 1-2 years.