TORONTO (Reuters) – Canada’s main stock market index fell on Friday by the most in nearly three months as a selloff in high-flying technology shares continued, while the Canadian dollar strengthened as domestic jobs data added to evidence of economic recovery.
The Toronto Stock Exchange’s S&P/TSX composite index (GSPTSE) fell 1.8% to 16,151.28, its largest decline since June 11. It was the second straight day of sharp declines for the TSX and other North American indices, which had been on a tear since March.
“The market sell-off has been driven by technology names which have fallen in sympathy with U.S. counterparts and equity markets in general,” said Ben Jang, a portfolio manager at Nicola Wealth. “Profit taking is not surprising given the recent outsized returns in technology.”
Shares of commerce platform provider Shopify (NYSE:SHOP) Inc <.SHOP.TO>, Canada’s largest company by market capitalization, fell 6.5%.
The information technology sector (SPTTTK) was down 4%, while the materials group (GSPTTMT) dropped 2.9% as shares of gold mining companies lost ground.
Gold (XAU) dipped 0.3% to $1,925 an ounce, while the price of oil (CLc1), one of Canada’s major exports was down 4.6% at $39.47 a barrel as weak demand figures added to concern over a slow recovery from the COVID-19 pandemic.
Canada added 245,800 jobs in August, the fourth consecutive monthly increase though the pace of new gains slowed, bringing employment within about a million jobs of pre-pandemic levels, Statistics Canada said.
The Canadian dollar was trading 0.4% higher at 1.3068 to the greenback, or 76.52 U.S. cents, as the jobs data added to evidence of economic recovery, with the currency clawing back much of its prior day’s sharp decline.
For the week, the loonie was up 0.2%. On Tuesday, it notched a near eight-month high at 1.2990.
Strategists are growing more bullish on prospects for the Canadian dollar as global economic activity rebounds from the coronavirus crisis, a Reuters poll showed.
Canadian government bond yields were higher across a steeper curve in sympathy with U.S. Treasuries. The 10-year (CA10YT=RR) was up 5.8 basis points at 0.597%, after having hit on Thursday its lowest intraday in more than three weeks at 0.518%.
Source: Economy - investing.com
