TORONTO — Canada's main stock index moved lower Monday, led by losses in technology and utilities stocks, while U.S. stock markets were also down.
The S&P/TSX composite index closed down 66.38 points at 25,625.42.
In New York, the Dow Jones industrial average was down 240.59 points at 44,401.93. The S&P 500 index was down 37.42 points at 6,052.85, while the Nasdaq composite was down 123.08 points at 19,736.69.
“It started pretty positive in the morning. It's just been slowly, slowly grinding down ever since,” said Michael Currie, senior investment adviser at TD Wealth.
Some of the market direction Monday was driven by two separate news stories out of China, he said.
“The (Chinese) central bank says they're starting to buy gold again, and they're looking to loosen their monetary policy a bit. So that helped oil a lot, helped gold a lot,” said Currie.
China also said it’s investigating semiconductor giant Nvidia over suspected violations of anti-monopoly laws, which sent the company’s stock lower.
Nvidia’s share price was down 2.6 per cent Monday at US$138.81.
Otherwise, “it’s all about interest rates today,” said Currie.
In the U.S., investors are awaiting the latest update on inflation later in the week. However, given that the slowing job market is more of a concern for the U.S. Federal Reserve at this point, the data is unlikely to change what investors currently expect from the Fed next week, said Currie: a quarter-percentage-point cut.
“Unless there's something really crazy out of the inflation numbers, there’s no reason to expect anything different is going to happen next week,” he said.
In Canada, where the central bank is gearing up for a rate decision Wednesday, a larger half-point cut is more likely, he said.
Expectations for a bigger cut rose after last week’s jobs report, which saw the unemployment rate jump to 6.8 per cent in November.
“The more we're cutting rates, especially the accelerated rate compared to the States, the more that just keeps beating up our dollar,” said Currie.
He expects more buzz in the coming months about the divergence between interest rates in Canada and the U.S. as the loonie continues to weaken.
“We're seeing it already, and as the gap gets bigger, it'll become more of a story.”
However, Currie noted the TSX briefly touched an all-time high earlier in the day.
“Basically since the US election, it's just been a non-stop rally,” he said.
The Canadian dollar traded for 70.77 cents US compared with 70.74 cents US on Friday.
The January crude oil contract was up US$1.17 at US$68.37 per barrel and the January natural gas contract was up 11 cents at US$3.18 per mmBTU.
The February gold contract was up US$26.20 at US$2,685.80 an ounce and the March copper contract was up eight cents at US$4.28 a pound.
— With files from The Associated Press
This report by The Canadian Press was first published Dec. 9, 2024.
Companies in this story: (TSX:GSPTSE, TSX:CADUSD)
Rosa Saba, The Canadian Press