Baystreet.ca - Canada's main stock index tumbled over 1% on Friday after a stronger-than-expected U.S. payrolls data sparked fears of a highly cautious approach towards interest rate reduction by the Federal Reserve this year.
The TSX slumped 305.78 points, or 1.2%, to close the Friday session at 24,767.73, marking its worst day since December 18 and its first weekly loss in three weeks. On the week, the index was punished nearly 306 points, or 1.12%.
The Canadian dollar eked higher 0.16 cents at 69.27 cents U.S.
In corporate news, Brookfield was reportedly mulling a takeover bid for Insignia Financial. Brookfield shares sagged $4.69, or 5,6%, to $79.49.
Elsewhere, Tilray (TSX:TLRY) Brands tumbled 23 cents, or 11.3%, to $1.76. after posting a wider second-quarter loss. Also in health-care, Bausch Health (TSX:BHC) Companies swooned 23 cents, or 2%, to $11.38.
Real-estate stocks were bruised, with FirstService (TSX:FSV) shares losing $6.63, or 2.6%, to $250.25, while those for Colliers International (TSX:CIGI) shed $5.04, or 2.6%, to $188.78.
Techs had their share of troubles, too, with Shopify (TSX:SHOP) clobbered $7.58, or 4.9%, to $147.82, while Quarterhill docking six cents, or 3.6%, to $1.61.
Energy stocks salvaged something from the day, with Suncor (TSX:SU) surging $1.56, or 2.8%, to $56.73, while IPCO took on 47 cents, or 2.6%, to $18.78.
In the consumer discretionary area, Aritzia (TSX:ATZ) skyrocketed $10.47, or 18.2%, to $67.41, while Gildan Activewear (TSX:GIL) grabbed $1.96, or 2.9%, to $69.57.
Statistics Canada said the economy created 91,000 jobs (+0.4%) in December. The unemployment rate declined 0.1 percentage points to 6.7%.
Building permits in this country decreased by $739.5 million (-5.9%) to $11.7 billion in November.
ON BAYSTREET The TSX Venture Exchange lost 6.66 points, or 1.1%, to 608.42, making for a weekly loss of nearly 15 points, or 2.39%.
All but two of the 12 TSX subgroups lost ground Friday with health-care sagging 4.4%, real-estate sinking 2%, and information technology slipping 1.9%,
The lone gainers proved to be energy, picking up 1.1%, and consumer discretionary stocks, pointing higher 0.2%.
ON WALLSTREET
Stocks tumbled Friday after a hot jobs report dampened Wall Street’s expectations for more interest rate cuts from the Federal Reserve this year.
The Dow Jones Industrials crumbled 696/75 points, or 1.6%, to close Friday and the week 41,938.45.
The S&P 500 Index dropped 91.21 points, or 1.5%, to 5,827.04
The NASDAQ Composite plummeted 317.25 points, or 1.6%, to 19,161.63. All three of the major averages sustained weekly losses, with the S&P 500 off 1.8% and the NASDAQ down 2.4%. The 30-stock Dow is on pace for a 1.6% decline on the week.
Growth stocks that could be hurt the most if a spike in rates causes investors to get more conservative led the session’s losses. Chipmaker Nvidia (NASDAQ:NVDA) shed 2.5%, while AMD (NASDAQ:AMD) dumped 5.2% and Broadcom (NASDAQ:AVGO) lost 2.1%. Palantir (NASDAQ:PLTR) was off by more than 1%.
U.S. payrolls grew by 256,000 in December, while economists polled by Dow Jones expect to see an increase of 155,000. The unemployment rate, which was projected to remain at 4.2%, fell to 4.1% during the month.
Traders give 97% odds the Fed stands pat on rates at its meeting later this month and now believe the central bank will hold rates where they are at the March meeting as well, based on fed funds futures trading. Odds of a March cut fell to around 25% following the data, down from 41% odds a day earlier. The Fed cut its benchmark rate by a quarter point last month.
Stocks took a leg lower after The University of Michigan’s consumer sentiment index signaled concern on the inflation front. The overall index came in at 73.2 for January, missing a Dow Jones estimate of 74. Part of that was driven by one-year inflation expectations rising to 3.3% from 2.8%. Five-year expectations also scaled to their highest level since June 2008.
U.S. markets were closed Thursday in memory of former President Jimmy Carter.
Prices for the 10-year Treasury sank, hiking yields to 4.76% from Wednesday’s 4.68%, its highest level since late 2023 after the jobs report. Treasury prices and yields move in opposite directions.
Oil prices regained $2.72 to $76.04 U.S. a barrel.
Prices for gold barreled ahead $26.00 an ounce to $2,716.80 U.S.
Indexes Feel Weight of Employment Report, Take Near-700-Point Spill