TSX dips as Shopify posts its biggest ever decline

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The facade of the original Toronto Stock Exchange building is seen in Toronto

By Fergal Smith

TORONTO – Canada’s main stock index fell on Wednesday as a record drop in the shares of e-commerce heavyweight Shopify Inc offset gains for resource shares.

The Toronto Stock Exchange’s S&P/TSX composite index ended down 118.91 points, or 0.55%, at 21,383.64.

“Most of these tech companies coming into earnings, the bar was set pretty high,” said Elvis Picardo, portfolio manager at Luft Financial, iA Private Wealth.

“Even if they met expectations, there was still disappointment they did not do more … Shopify is the latest example of this.”

Shares of Shopify, which has the third-largest market capitalization on the TSX, fell 17.1% after the company forecast a slowing pace of revenue growth in the first half of the year and said it was ramping up spending on a network of fulfillment centers.

It was the biggest decline for the shares since the company went public in 2015, while the closing level was the lowest since May 2020.

The technology group was down 3.9%, while the consumer staples group was also a drag, ending 0.7% lower.

In contrast, the materials group, which includes precious and base metals miners and fertilizer companies, added 1.8% as gold prices climbed.

It included a gain of 7.1% for Barrick Gold Corp after the miner announced a share repurchase of up to $1 billion and a bigger dividend payout as fourth-quarter results beat analysts’ estimates.

The energy sector was up 0.7% as oil prices rose. U.S. crude oil futures settled 1.7% higher at $93.66 a barrel, with investors weighing conflicting statements on the possible withdrawal of some Russian troops from around Ukraine.

(Reporting by Fergal Smith; Additional reporting by Amal S in Bengaluru)

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