Middle East Tensions Push TSX Lower; Energy Stocks Rally
(RTTNews) - The Canadian market's benchmark index S&P/TSX Composite Index remains firmly down in negative territory a little past noon on Wednesday, weighed down by losses in financials and materials sectors.
Energy stocks are up sharply thanks to higher oil prices. Communications sector stocks are among the other notable gainers.
The market's weakness is due to renewed concerns about inflation following a jump in oil prices due to an escalation in Middle East tensions. Joint strikes by the United States and Saudi Arabia on Iraq, targeting Iran-backed militias have raised concerns about a widening U.S.-Iran conflict. Investors are also awaiting the Federal Reserve's monetary policy announcement.
The S&P/TSX Composite Index, which rose to a new record high in the previous session, is down 459.33 points or 1.28% at 35,290.37 about a quarter past noon.
The Financials Capped Index is down by about 2.1%. Intact Financial Corporation is down 4.3%, weighed down by a drop in earnings. The company reported second-quarter net income of C$720 million, compared with C$867 million in the year-ago quarter.
Bank of Montreal, Canadian Imperial Bank of Commerce and National Bank of Canada are down 2.5%-2.7%. Toronto-Dominion Bank, Bank of Nova Scotia, Royal Bank of Canada, Sun Life Financial and Manulife Financial are down 1%-2%.
Great-West Lifeco Inc reported second-quarter earnings of C$1.039 billion, or C$1.15 per share, compared with C$894 million, or C$0.96 per share, a year earlier. The stock is down 1.7%.
The Materials Capped Index is down 2.2%. Allied Gold Corporation is tanking 17%. Abrasilver Resource Corp., Americas Gold & Silver Corporation, G. Mining Ventures, Ssr Mining, Endeavour Silver Corp., First Majestic Silver Corp, Equinox Gold Corp and B2Gold Corp are down 4%-7%.
First Quantum Minerals reported second-quarter net earnings of $136 million, or $0.16 per share, compared with $18 million, or $0.02 per share, a year earlier.
In the industrials section, Badger Infrastructure Solutions, Aecon Group, Tfi International, Hammond Power Solutions, Bird Construction, Finning International, Mullen Group, Bombardier and MDA Space are down 3%-7%.
Toromont Industries Ltd's net earnings in the second quarter came in at C$124.5 million, or C$1.53 per share, compared with C$124.3 million, or C$1.53 per share, a year earlier. The stock is down 1.7%.
The Energy Capped Index is up 2.6%. Cenovus Energy is rising 4%. Cenovus Energy reported earnings per share of $1.53 for the second quarter, compared with $0.45 in the year-ago quarter.
Canadian Natural Resources, Strathcona Resources, Vermilion Energy, Baytex Energy, Spartan Delta Corp., and Tamarack Valley Energy are gaining 3%-4%. Parex Resources, Paramount Resources, Headwater Exploration and Arc Resources are also up sharply.