Canada’s main stock index tracked losses in commodity shares on Tuesday, with a slowdown in manufacturing activity last month and tensions between the United States and China over U.S. House Speaker Nancy Pelosi’s expected visit to Taiwan denting sentiment.
At 10:13 a.m. ET, the Toronto Stock Exchange’s S&P/TSX composite index was down 173.01 points, or 0.88%, at 19,519.91, amid a broader risk-off mood across the global markets on concerns that Pelosi’s trip to Taiwan could worsen tensions between Beijing and the Washington.
The energy sector and the materials sector dropped 2.6% and 0.7%, respectively, tracking weakness in commodity prices as Sino-U.S. tensions and weak factory data across the United States, Europe and Asia on Monday pushed investors to safer assets.
In Canada, data showed production and new orders declined for the first time since the early stages of the coronavirus pandemic.
“Businesses have right now shrunk down with rising labor costs and higher interest rates. You can’t keep expanding, you can’t keep hiring and you can’t keep growing the business when conditions are not favorable,” said Allan Small, senior investment advisor at Allan Small Financial Group.
The financials sector slipped 1.1%, while industrial stocks fell 0.9%.
Meanwhile, Air Canada dipped 1.2% after missing on earnings and forecasting higher full-year expenses.
Toronto Dominion Bank fell 1.2% on announcing it will buy New York-based boutique investment bank Cowen to boost its presence in the high-growth U.S market.
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