By Ketki Saxena
Investing.com -- At the close in Toronto, the S&P/TSX Composite Index was at 19,078.64 points, down 0.75% in the day’s trading.
The Canadian benchmark tracked U.S. equities lower on renewed worries of aggressive policy tightening and recession risks, following comments by Federal Reserve chair Jerome Powell. Powell re-iterated the risk that interest rate increases could trigger a slowdown, but that persistent inflation remained a greater worry.
The Fed Chair’s comments at the European Central Bank forum echo remarks from other Fed policymakers in recent days, including the Presidents of the New York, San Francisco, and Cleveland Feds, who continue to call for faster rate-hike action to rein in inflation
The commodity-heavy Canadian index was further pressured by crude, which reversed gains from this morning as worries about slowing global growth, and a rise in U.S. gasoline and distillate inventories overshadowed the ongoing concerns around supply tightness.
The Canadian index also remained pressured by weakness in gold as the dollar strengthened, and a sharp decline in rate-sensitive tech stocks.
The biggest gainers of the session on the S&P/TSX Composite were Alamos Gold Inc (TSX:AGI), which rose 4.35% or 0.39 points to trade at 9.35 at the close. George Weston Limited added 2.79% or 4.12 points to end at 151.60 and Waste Connections Inc (TSX:WCN) was up 2.64% or 4.13 points to 160.74 in late trade.
The biggest losers included Aurora Cannabis Inc (TSX:ACB) which lost 8.81% or 0.17 points to trade at 1.76 in late trade. Capstone Mining Corp (TSX:CS) declined 8.31% or 0.30 points to end at 3.31 and Corus Entertainment Inc (TSX:CJRb) shed 7.79% or 0.31 points to 3.67.
In New York, the Dow Jones Industrial Average added 0.27%, while the S&P 500 index declined 0.07%, and the NASDAQ Composite index fell 0.03%.
U.S. indices turned lower today following Jerome Powell’s remarks, and as US GDP contracted 1.6% in the first quarter, compared to the 6.9% growth in the fourth quarter of last year.
The second quarter ends tomorrow. if data for this quarter does not reflect does not return to positive growth, the U.S. economy will technically be in a recession.
The GDP contraction also comes within the context of a record trade deficit, and dismal consumer confidence data released yesterday.