Tech, Commodity Stocks Weakness Hurts Canadian Market

(RTTNews) - The Canadian market is down sharply in negative territory a little past noon on Thursday, weighed down by sharp losses in energy, materials and technology sectors.

Rising concerns about inflation and possible rate hikes by the Federal Reserve and the Bank of Canada this year, and worries about AI spending contributed to market's decline. Investors are also reacting to data showing a sharp increase in Canadian producer prices.

Oil prices moved up sharply, fueling inflation concerns. West Texas Intermediate Crude oil futures are up $1.60 or 1.65% at $98.75 a barrel.

Weak precious metals prices weigh on materials stocks. Gold futures are down more than 2%, while Silver futures are lower by nearly 4.5% and Copper futures are trading 2.7% down.

Communications, real estate, industrials, consumer staples and consumer discretionary stocks are finding good support, but the overall mood in the market remains bearish.

The benchmark S&P/TSX Composite Index, which tumbled to 35,806.38, was down 375.21 points or 1.03% at 35,949.74 a few minutes past noon.

Celestica is plunging more than 10%. Silvercorp Metals, Centerra Gold, Hudbay Minerals, Iamgold Corporation, Enerflex, Torex Gold Resources, Fortuna Silver Mines, Eldorado Gold, BlackBerry, TransAlta, SSRMining and B2Gold Corp are down 6%-8%.

Teck Resources is down more than 4%. The company announced that it has received a strike notice at Highland Valley Copper, or HVC, Operations from the United Steelworkers, or USW, Local 7619. The strike notice entitles the union to begin strike action on October 24 at the earliest.

Wheaton Precious Metals, First Quantum Minerals, Endeavour Mining, Lundin Gold, Ero Copper, Teck Resources, Kinross Gold, Methanex, Franco-Nevada Corp., Cameco, Imperial Oil and Cenovus Energy are among the other big losers.

Among the gainers, Waste Connections is soaring nearly 9%. Mullen, FirstService and Thomson Reuters are up 7.5%, 7.4% and 6.5%, respectively.

Altus, Constellation Software, Ritchie Bros Auctioneers, Rogers Communications, Telus, Boyd Services, TFI International, Canadian Pacific Railway, WSP Global, Open Text Corporation, Interfor, BCE, Premium Brands, Kinaxis, West Fraser Timber, Canadian Tire Corporation, BRP and Colliers International Group are up 2.5%-4%.

Loblaw Companies, Kinaxis, International Petroleum Corporation, Gran Tierra Energy, ACT Energy Technologies, Knight Therapeutics, Baytex Energy and CCL Industries hit new 52-week highs today.

Data from Statistics Canada showed producer prices in Canada increased 14.5% in September over the same month in the previous year. Producer prices rose 2% month-on-month in September, the highest level since March, accelerating from a revised 1.2% increase in August.

Meanwhile, raw materials prices increased to 27% (year-on-year) in September from 22.9% in August. Raw materials prices rose 3.1% month-on-month in August, rebounding from a 2.1% decline in July and well above market expectations of a 0.7% gain.

A report from the Canadian Federation of Independent Business, Canada's CFIB Business Barometer long-term index, measuring 12-month business expectations, rose to 50 in October from 48.5 in September, reaching neutral territory.