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Global equity markets tumbled on Tuesday amid fears of Lockdown 2.0 after coronavirus cases surged at a rapid pace in some parts of the world. Canadian markets traded lower for the second straight day with the S&P/TSX Composite Index declining by 58.61 points or 0.36% to 16,020.94.
The index is hovering in a short-term bearish trend as it traded below its crucial short-term support levels of 50-day and 30-day Simple Moving Averages (SMAs), which act as a short-term support level for any underlying index and security. The index heading downward and oscillating near its long-term support level of 200-day SMA. Also, the index hovering below is immediate support levels of 5-day, 10-day, 20-day and 30-day SMAs, another bearish indicator.
Further establishing the bearish trend, the moving average convergence divergence (MACD) is falling and oscillating below its 9-day SMA signal line, with the difference between 12-day and 26-day SMA being negative.
5-day Price Chart (as on October 27, 2020, after the market close). Source: EODHD/Others (Thomson Reuters)
At the last closing, TSX Composite Index featured a dividend yield of 3.64% and traded at a Price-to-Earnings (PE) multiple of 17.43x.
COVID-19 Update
Canada’s death toll due to the Coronavirus pandemic surpassed 10,000 with an additional 28 deaths reported on Tuesday. The total number of confirmed cases spiked to 222,654, an increase of over 20% in the past fortnight. Prime Minister Justin Trudeau warned that if the current trajectory of the winter surge continues, it may well impact family gatherings during the upcoming Christmas season.
Stocks in Play*
Gainers: Colliers International Group Inc (up 12%), Husky Energy Inc (up 7.3%), and Cenovus Energy Inc (up 6.7%)
Losers: Aurora Cannabis Inc (down 9.5%), Teck Resources Ltd (down 5.9%), and Maple Leaf Foods Inc (down 4.7%)
Volume Gainers: Cenovus Energy Inc., Royal Bank of Canada, and Nevada Copper Corp.
On Wall Street: All three major indices of the United States posted mix results. The Dow and the S&P 500 plunged on disappointing earnings as investors’ hopes for coronavirus stimulus before Election Day faded. The Dow and S&P 500 settled 0.80% and 030% lower, respectively. However, the Nasdaq managed to eke outed gains as investors looked ahead to biotechnology company results and ended 0.64% higher.
Commodity News*
Gold Futures traded higher and up 0.33% to US$ 1,911.90/bbl, led by weakness in the greenback.
The Brent Oil Futures traded 1.83% higher at US$ 41.20/bbl and American Oil Benchmark Crude WTI bagged 2.61% to US$ 39.57/bbl.
The USD/CAD dropped -0.17% to 1.3184.
*Details as on October 27, after markets close
