By Fergal Smith
TORONTO – Canada’s main stock index fell on Tuesday, pulling back from a record intraday high, as the potential for aggressive U.S. interest rate hikes weighed on investor sentiment.
The Toronto Stock Exchange’s S&P/TSX composite index ended down 154.77 points, or 0.7%, at 21,930.83, after earlier touching a record level of 22,213.07.
Wall Street’s main indexes also fell after comments from Federal Reserve Governor Lael Brainard spooked investors about potential aggressive actions by the central bank to control inflation.
The drop in U.S. stocks was a “headwind” for the Toronto market, said Colin Cieszynski, chief market strategist at SIA Wealth Management.
“Canada is definitely more of a resource market than the United States and when you’re at the beginning of a rate hike cycle – that can be a bit of a headwind.”
Canada’s energy sector retreated 1.6% as oil prices fell. U.S. crude oil futures settled 1.3% lower at $101.96 a barrel, pressured by a rising U.S. dollar and growing worries that new coronavirus cases could slow demand.
The materials group, which includes precious and base metals miners and fertilizer companies, lost 2.5%. Gold was down 0.5% at about $1,922 per ounce.
Still, Canadian economic data was upbeat. It showed that exports rose 2.8% in February to a record high, driven mostly by energy products, with economists anticipating more gains for exports ahead.
Among the biggest decliners on the TSX was Lithium Americas Corp. It fell 10.6%, giving back some recent gains.
(Reporting by Fergal Smith; Additional reporting by Devik Jain in Bengaluru; Editing by Alistair Bell)
