Stocks Take Lumps at First on Tuesday
Wells, Morgan in Focus
Canada's main stock index opened lower on Tuesday after a fall in commodity prices weighed on energy and materials stocks as demand concerns from China mounted while investors get ready to tackle higher-for-longer interest rates.
The TSX Composite Index began the day in the red 64.3 points to 19,736.31.
The Canadian dollar flopped 0.26 cents at 74.08 cents U.S.
In corporate news, Air Canada on Monday signed an agreement with U.S. plane maker Boeing to buy 18 widebody 787 Dreamliner jets.
Shares in the“Maple Leaf Airline” gave back nine cents to $18.82, while those for Boeing tailed off 73 cents to $198.05 U.S.
The TSX Venture Exchange fell 4.09 points to kick off Tuesday at 566.18.
All but two of the 12 TSX subgroups were lower, as real-estate retreated 0.9%, while communications and information technology each dipped 0.8%.
The two gainers were energy, up 0.8%, and health-care bettered themselves 0.3%.
Stocks fell Tuesday after the latest home sales and consumer confidence reports disappointed expectations.
The Dow Jones Industrials turfed 261.14 points to begin Tuesday at 33,745.34.
The S&P 500 index dumped 46.67 points, or 1.1%, to 4,290.77.
The NASDAQ index tumbled 163.21 points, or 1.2%, to 13,271.32.
JPMorgan Chase CEO Jamie Dimon warned interest rates may need to rise further to tamp down inflation, comments that added to bearish sentiment Tuesday. Bank stocks declined, as Wells Fargo shares dropped more than 1%, while Morgan Stanley fell nearly 1%.
Those moves would add to the market's losses for the month. The NASDAQ Composite is down more than 6% in September, while the S&P 500 gave back more than 4% and Dow lost more than 2%. Among the catalysts pushing stocks lower this month is the Federal Reserve warning that it sees fewer rate cuts next year. The news pushed the benchmark 10-year Treasury yield to levels not seen since 2007.
Investors this week are also grappling with negotiations in Washington, as lawmakers hope to avert a government shutdown that could take place as early as Oct. 1 if Congress doesn't agree on a spending bill.
Still, upcoming seasonal market tumult could present a window for investors. Though October is known as the“jinx month” because of the 1929 and 1987 crashes, it also has a reputation as a“bear killer,” according to the“Stock Trader's Almanac.”
Prices for the 10-year Treasury grew a mite, lowering yields to 4.52% from Monday's 4.54%. Treasury prices and yields move in opposite directions.
Oil prices faltered 24 cents to $89.44 U.S. a barrel.
Gold prices tunneled 11 dollars to $1,925.60.
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