Skip to main content

Wall Street ended lower on Friday as investors assessed economic data and awaited a potential 50-basis point interest rate hike by the U.S. Federal Reserve at its policy meeting next week, while apparel company Lululemon slumped following a disappointing profit forecast. Canada’s main stock index closed lower for a sixth straight session, as weaker oil prices dragged on energy shares.

U.S. producer prices rose slightly more than expected in November amid a jump in the costs of services, but the trend is moderating, with annual inflation at the factory gate posting its smallest increase in 1-1/2 years, data showed.

“Today’s data shows that inflation is coming down, but it’s lingering and is stickier than most assume,” said Anthony Saglimbene, chief market strategist at Ameriprise Financial in Troy, Michigan.

However, in December, consumer sentiment improved, while inflation expectations eased to a 15-month low, a University of Michigan survey showed.

Futures trades suggest a 77% chance the Fed will raise interest rates by 50 basis points next week, with a 23% chance of a 75-basis point hike, with those odds little changed after Friday’s economic data.

U.S. consumer prices data for November, due Tuesday, will provide fresh clues on the central bank’s monetary tightening plans.

Lululemon Athletica Inc tumbled almost 13% after the Canadian athletic apparel maker forecast lower-than-expected holiday-quarter revenue and profit.

The Toronto Stock Exchange’s S&P/TSX composite index ended down 22.12 points, or 0.1%, at 19,947.07, its lowest closing level since Nov. 17. For the week, the index was down 2.6%, its biggest weekly decline since September.

“You have this balancing act that the Fed and the Bank of Canada need to do, to bring down the economy slowly to bring down inflation, but don’t bring it down too much where the whole country goes into a deep recession,” said Allan Small, senior investment advisor of the Allan Small Financial Group with iA Private Wealth.

The Bank of Canada will likely need to keep interest rates at or above 4% for most of 2023 to cool an overheated economy and tame high inflation, the International Monetary Fund said Friday.

The Toronto market’s energy sector fell 0.7% as U.S. crude oil futures settled 0.6% lower at $71.02 a barrel. That took oil’s losses for the week to roughly 11%.

An outage at TC Energy’s Keystone pipeline could affect inventories at a key U.S. storage hub and cut crude supplies to two oil-refining centers, analysts and traders said.

TC Energy’s shares ended 0.4% lower.

Turquoise Hill Resources Ltd shares rose 0.9% as shareholders voted in favor of Rio Tinto’s $3.3 billion bid to take the company private and gain direct control over a giant Mongolian copper mine.

On Wall Street, the S&P 500 declined 0.73% to end the session at 3,934.38 points.

The Nasdaq declined 0.70% to 11,004.62 points, while Dow Jones Industrial Average declined 0.90% to 33,476.46 points.

Of the 11 S&P 500 sector indexes, 10 declined, led lower by energy, down 2.33%, followed by a 1.28% loss in health care. The energy index recorded a seventh straight session of losses, its longest losing streak since December 2018.

For the week, the S&P 500 dropped 3.4%, the Dow lost 2.8% and the Nasdaq shed 4%.

Broadcom Inc jumped 2.6% after the chipmaker forecast current-quarter revenue above Wall Street estimates.

Boeing Co climbed 0.3% after Reuters report the plane maker plans to announce a deal with United Airlines for orders of 787 Dreamliner next week.

Declining stocks outnumbered rising ones within the S&P 500 by a 3.3-to-one ratio. The S&P 500 posted 5 new highs and 1 new lows; the Nasdaq recorded 54 new highs and 213 new lows. Volume on U.S. exchanges was relatively light, with 9.9 billion shares traded, compared to an average of 10.9 billion shares over the previous 20 sessions.

Also see: Market movers: Stocks that saw action on Friday - and why

Reuters, Globe staff

Be smart with your money. Get the latest investing insights delivered right to your inbox three times a week, with the Globe Investor newsletter. Sign up today.