The TSX fell today with technology shares dropping 3.67 per cent to a two-year low.
Investors are in the process of de-risking as hawkish monetary policy takes hold around the world.
Shopify fell over 10 per cent after missing Q1 estimates. It fell 14.3 per cent in the previous session. The stock is now below its pre-pandemic level having fallen just under 70 per cent this year.
E-commerce stocks have been dropping due to decreased online shopping, including Amazon falling 14 per cent last Friday, its biggest one-day drop since 2006, due to its first quarterly loss in seven years.
Energy stocks also fell up to 1.3 per cent, running counter to the E.U.’s pending sanctions on Russian oil and the U.S. announcing that it will begin buying oil to replenish reserves.
The E.U. is looking to ban Russian crude in six months and oil-based products by year end due to the ongoing war in Ukraine.
Oil was set for its first back-to-back weekly gain in two months with WTI up 2.37 per cent and Brent up 1.3 per cent in mid-afternoon trading. The commodity remains up approximately 40 per cent this year despite worries about Chinese consumption due to a lingering COVID outbreak.
Global food prices also remain near record highs due to severely disrupted Ukrainian crop exports, grain and vegetable oil chief among them. The country is dealing with ongoing clashes with Russia in the east, including the Azovstal Iron and Steel Works plant in Mariupol, where almost 500 people had been evacuated with more hopefully to follow.
High fertilizer prices, weather worries and crop protectionism are adding to these high prices, with Serbia and Kazakhstan imposing grain shipment quotas, India considering a limit on wheat exports due to heat damaged crops, and drought conditions affecting the U.S. wheat crop.
While tight supply in energy and consumer staples is contributing to surging global inflation, U.S. jobs data this week showed that a lower participation rate may worsen labor shortages and stoke inflation even higher.
Adding to these fears of runaway prices, today’s report from Statistics Canada showed the economy gained 15,300 jobs in April, well short of the expected 40,000 amid elevated demand from employers. The unemployment rate fell slightly to 5.2 per cent, the lowest since 1976, building the Bank of Canada’s case for more rate hikes to cool productivity down to a sustainable level.
Canada added just under 1M jobs over the past year, almost half a million above February 2020. That said, the pandemic is still very much present, with hours worked falling 1.9 per cent in April due to COVID-related absences.
The TSX closed down by 0.3 per cent, recording its sixth consecutive week of declines, while staying over 14 per cent ahead of the U.S., Developed International and Emerging Markets in 2022.
The Canadian dollar has weakened against the greenback to the tune of C$0.08 over the past year, making Canadian exports more attractive amidst rising prices.
Canadian bond yields rose across the curve this week, as they have throughout this year, leaving retirees without adequate cash reserves in a bind to meet their spending needs over the next few years.
Market movers
Over the latter half of the week, our readers have concentrated on firms in crypto, finance and technology with good prospects of excelling during a mature economic cycle.
HIVE Blockchain reported that its Bitcoin mining capacity increased by 8 per cent in April to 2.15 exahash.
Marble Financial entered into a licensing agreement to bring its fintech solutions to Thirdstream, a financial services firm representing over 6.4M Canadians.
Finally, Datametrex has detailed recent insider purchases of 2,420,000 shares.
Capital raises announced over the past two days include Tetra Bio-Pharma, Bear Creek Mining and Avalon Advanced Materials.
