TSX Drops 1.43% to 24,156.87, Led by Technology and Materials; Monthly Gain Holds at 0.65%
Toronto, Oct 31 2024 – Canada’s main stock index experienced a significant downturn on Thursday, closing at a three-week low as technology shares led a broader market selloff. The S&P/TSX composite index fell by 350.92 points, or 1.43%, ending the day at 24,156.87, its lowest level since October 8. Despite the drop, the index has recorded a 0.65% gain for the month, marking its fourth consecutive monthly increase.
Michael Constantino, CEO of Webull Canada, noted, “Given the recent market run, a pullback was anticipated.” This sentiment echoed across the border, as U.S. stocks also declined following comments from Microsoft and Meta Platforms about rising artificial intelligence costs potentially impacting their earnings, dampening enthusiasm for large-cap stocks that have been driving the market’s rally this year.
Brian Madden, chief investment officer at First Avenue Investment Counsel, remarked, “It’s unusual for the Canadian market to completely diverge from U.S. trends in the short term,” highlighting how U.S. selling pressure affects Canadian sentiment.
The materials sector, which includes fertilizer and metal mining companies, dropped 2.4% as gold prices retreated from record highs. Despite this, the materials index has surged more than 30% since the beginning of 2024. “We’re still seeing client interest in financials and materials, which have been strong performers this year,” Constantino added.
On Thursday, financials fell 1.4%, while the technology sector declined by 2.8%, led by Open Text Corp, which saw its shares plunge 11.1% after reporting quarterly revenue that fell short of analysts’ expectations. Energy stocks also faced pressure, with Cenovus Energy Inc down 3.4% following a 56% drop in third-quarter profits attributed to declining production.
In contrast, Bausch Health Companies Inc emerged as a standout, with shares surging 12.7% after reporting stronger-than-expected third-quarter earnings.
Source: Reuters