TSX starts month on weak note as China slowdown hits sentiment
4:18 pm Tuesday, August 01st, 2023
By Fergal Smith
(Reuters) -Canada’s main stock market index fell on Tuesday to start the new month on a cautious note, weighed by losses for metal-mining shares as investors worried about an uncertain outlook for some major economies including China.
The Toronto Stock Exchange’s S&P/TSX composite index ended down 93.71 points, or 0.5%, at 20,532.93, after posting its highest closing level in three months in the previous session.
“We are overbought and we’re pulling back,” said Robert McWhirter, a portfolio manager at Selective Asset Management Inc. “Everybody is still scratching their head about China.”
Global factory activity remained in a slump in July, private surveys showed, a sign slowing growth and weakness in China were taking a toll on the world economy, including Canada’s.
Canadian manufacturing activity slowed for the third straight month in July. The slowdown has occurred amid a sharp rise in interest rates and after the economy was buffeted in recent months by Canada’s worst-ever spring wildfire season and a dock workers strike at the country’s busiest ports.
A union representing dock workers on Canada’s West Coast will convene a special meeting with members on Wednesday to recommend they accept the latest offer from employers, the union said.
The materials group, which includes precious and base metals miners and fertilizer companies, lost 1.8% as gold and copper prices fell.
Shares of Silvercrest Metals were particularly weak, plunging 21.5% after two brokerages cut their price target on the stock.
Heavily weighted financials fell 0.6% and healthcare was down 2%.
The TSX notched a gain of 2.3% in July, while it has advanced 5.9% since the start of the year.
(Reporting by Fergal Smith in Toronto and Siddarth S in Bengaluru; Editing by Shilpi Majumdar and Cynthia Osterman)
