Skip to main content

Shares in Toronto’s main stock index opened lower on Thursday but then rebounded slightly and energy stocks edged higher despite oil prices hitting their lowest levels in more than a year.

At 9:55 a.m., the Toronto Stock Exchange’s S&P/TSX composite index was up 29.83 points, or 0.21 percent, at 14,293.89.

Materials stocks were up 2.5 per cent, energy stocks added 0.3 per cent. But telecom stocks were off 0.3 per cent and utilities fell 0.1 per cent.

Oil prices fell more than 4 per cent on Thursday, hitting their lowest in more than a year on worries about oversupply and the outlook for energy demand as a U.S. interest rate rise knocked stock markets.

U.S. light crude oil fell by US$2.35 a barrel, or 4.9 per cent, to a low of US$45.82, before recovering some ground to around US$46.45.

Brent dropped by US$2.60, or 4.5 per cent, to US$54.64 a barrel, its lowest since September 2017, and last traded around US$55.54, down US$1.70.

Both major oil futures contracts rallied sharply on Wednesday but are now at or close to their lowest levels for over 15 months, more than 30 per cent below multi-year highs reached at the beginning of October.

In stocks news, BlackBerry Ltd. reported a quarterly profit of US$59-million in the third quarter, compared with a loss of US$275-million a year earlier. (The year-earlier period included a one-time charge of US$149-million related to a payment dispute with Finland’s Nokia Oyj.) Revenue was unchanged at US$226-million. BlackBerry’s TSX-listed shares were up 5.4 per cent on the results.

In other corporate news, U.S.-listed shares of B.C.-based cannabis company Tilray Inc. were up 9.5 per cent in premarket trading on news of a joint venture that will see Labatt Brewing Company Ltd., AB InBev’s Canadian subsidiary, and Tilray will each contribute up to US$50-million to a joint venture focused on researching tetrahydrocannabinol (THC) and cannabidiol (CBD)-infused drinks, the companies said on Wednesday.

U.S. stocks fell at open on Thursday, extending losses from the previous session after the Federal Reserve’s forecast of fewer interest rate increases in 2019 fell short of investors’ hopes of a more dovish monetary policy.

The Dow Jones Industrial Average fell 132.01 points, or 0.57 per cent, to 23,191.65.

The S&P 500 opened lower by 7.64 points, or 0.30 per cent, at 2,499.60. The Nasdaq Composite edged up 10.26 points, or 0.15 per cent, to 6,648.27.

The Fed raised interest rates on Wednesday and projected two hikes next year, instead of three, but what spooked the markets was Fed Chairman Jerome Powell saying the central bank would keep its balance sheet reduction on autopilot.

The specter of rising borrowing costs only added to concerns of slowing corporate profit growth next year amid slackening economic growth, with increasing fears of a recession in the backdrop of the China-U.S. trade war and a host of other geopolitical concerns.

U.S. stocks swooned to close about 1.5 per cent lower. The Dow Industrials Average closed at its lowest since November last year and the Dow Transports closed nearly 21 per cent below its record high, confirming bear territory.

“I believe the reaction after the Fed meeting was a bit overdone. The immediate reaction to a surprise is always negative and sell buttons always get hit very quickly,” said Randy Frederick, vice president of trading and derivatives for Charles Schwab in Austin.

The S&P 500 ended 14.5 per cent lower than its record closing high on Sept. 20, with 298 components now down 20 per cent or more from their 52-week highs.

Shares of Walgreens Boots Alliance Inc. were down 2.2 per cent as the drugstore chain launched a cost-cutting plan after beating estimates.

Conagra Brands Inc. dropped 9.4 per cent after the packaged foods maker’s sales missed estimates on delayed shipments and weak demand.

Accenture Plc fell 2.6 per cent as its full-year revenue and profit outlook largely fell below estimates.


Follow related authors and topics

Authors and topics you follow will be added to your personal news feed in Following.

Interact with The Globe