Canada's main resource-heavy stock index decline
Business
Commodity equities decline, hotter-than-expected domestic producer pricing data adds to anxiety
TORONTO (Reuters) - As commodity-linked equities declined and hotter-than-expected domestic producer pricing data added to market anxiety about interest rate rises, Canada's main resource-heavy stock index declined on Friday.
The S&P/TSX composite index of the Toronto Stock Exchange was down 66.4 points, or 0.32%, at 20,540.02 as of 10:24 a.m. ET, signaling the start of a second week of falls.
Contrary to expectations, producer prices increased by 0.4% in Canada in January, increasing market concerns about future monetary tightening from central banks.
Investors are becoming cautious as they assess how far central banks may go to stifle the economy, according to Edward Jones Investments investment analyst Angelo Kourkafas.
"Bank of Canada has even declared their intention to change course. The caveat is that the BoC will probably exercise greater care with future rate rises than the Fed will, depending on the data.
The largest drag on the index was the energy sector, which was down 2.2% as oil prices fell on worries about more interest rate increases by the US Federal Reserve that may hurt demand as well as indications of excess supply.
Agnico Eagle Mines and IAMGOLD Inc., both of which failed earnings projections for the fourth quarter, contributed to a 1.5% decline in the value of the gold mining industry. Falling spot gold prices added to the burden.
The largest carrier in the nation announced a larger-than-expected quarterly loss per share, which caused Air Canada's earnings to decline 8.8%, ranking it among the top losers on the TSX.
MTY Food Group Inc. continued to lose ground, dropping 8.1% as a number of brokerages lowered their price targets in response to the casual dining chain's announcement of a dip in fourth-quarter net income.
