TSX edges lower as investors digest Fed’s hawkish take, NexJ top mover

Highlights

• The S&P/TSX composite index was down by 37.17 points on Monday.
• The index was primarily pulled up by the energy sector.
• The Canadian dollar bolstered against its US counterpart on Monday.

After ending last Friday’s session at a noticeable low of 19,873.29, the main Canadian stock index slipped further on Monday, August 29, as investors continued to struggle with inflation.

However, analysts argued that the markets were relatively calmer on Monday than they had been last Friday following US Fed Reserve Chair Jerome Powell’s hawkish speech.

The index was primarily pulled up by the energy sector, which surged by about 1.7 per cent. Losses were incurred in the base materials sector, which slipped by 1.33 per cent.

At close, the S&P/TSX composite index was down by 37.17 points, or 3.92 per cent, settling at 19,836.12 on Monday.

One-year price chart of TSX Composite Index along with SMA 20-day, SMA 30-day, SMA-50-day (August 29). Analysis by © 2022 Kalkine Media®).

Active Volume

From a volume standpoint, TSX players Barrick Gold Corporation (TSX: ABX), Suncor Energy Inc. (TSX: SU) and Manulife Financial Corporation (TSX: MLF) were among the most active stocks on Monday, with a trading volume of 26.78 million, 25.84 million and 12.53 million, respectively.

Movers and Laggards

Wall Street Update

US stocks also started off the week with a dip following Mr Powell’s remarks the previous week, where he left investors surprised as he made it clear that interest rates would continue to climb and remain elevated longer than expected.

The Dow Jones industrial average tumbled by 184.41 points to 32,098.99, while the S&P 500 index slipped 27.05 points to 4,030.61. The Nasdaq, on the other hand, lost 124.04 points to 12,017.67.

Commodity Update

Gold, which many investors seek out to hedge against inflation, saw its prices drop on Monday. The yellow metal dipped by 0.31 per cent to US$ 1,744.25/oz.

Brent Oil Futures for November 2022 were down by 0.48 per cent to US$ 102.44 a barrel, while Crude WTI Futures for October 22 sank by 0.39 per cent to US$ 96.63 a barrel.

Currency News

On Monday, the Canadian dollar bolstered against its US counterpart amid rising expectations that the Bank of Canada will hike its rates again in the coming month.

Meanwhile, the USD/ CAD was down 0.39 per cent at 1.3011 on August 29.

Money Market

US Treasury yields shot up on Monday in the wake of Mr Powell’s remarks the previous week, with the US 10-year bond yield rising to 3.114 per cent.

The Canada 10-year bond yield, on the other hand, shot up to 3.104 per cent at close on Monday.