TORONTO — Canada's main stock index started the shortened trading week slightly lower on a broad-based decline involving the energy and technology sectors.
"It's a pretty benign day across the board for equities, which quite frankly given the moves that we've seen quiet days are to be expected periodically ... it does provide a bit of a breather for equity markets to mount perhaps another charge," said Craig Fehr, investment strategist, Edward Jones.
He said the economic recovery should be a wind at the back of markets as the year progresses.
"It won't produce gains every single day and days like today are necessary to the process for markets to catch their breath," he said in an interview.
Stock markets continue to focus on broader themes around the reopening, vaccine distribution and the pace of the economic recovery.
The S&P/TSX composite index closed down 33.36 points to 18,719.22.
In New York, the Dow Jones industrial average rose 98.49 points to a record close of 33,171.37 after setting an intraday high. The S&P 500 index lost 3.45 points at 3,971.09, while the Nasdaq composite was decreased 79.08 points at 13,059.65.
Markets were also flat due to some sapping of enthusiasm over news about a hedge fund margin call that some investors fear could have broader implications for banks, said Fehr.
Overseas banks Nomura and Credit Suisse warned of losses after Archegos Capital was required to unwind some those positions.
"I don't think that this is a more systemic threat to the market but after the run that equities have been on over the past several months and the valuation levels that they sit at today, I think we're going to find that these small periodic risks can weigh or at least add a little bit of volatility to the market," Fehr added.
The Canadian dollar traded for 79.40 cents US compared with 79.49 cents US on Friday.
Seven of the 11 major sectors on the TSX were lower, led by health care, real estate and energy.
Health care dropped 1.6 per cent as Canopy Growth Corp. fell 2.7 per cent and Aphria Inc. was down 2.1 per cent.
Energy lost about one percentage point even as crude oil prices rose despite early weakness after the a massive container ship was dislodged from blocking the Suez Canal for nearly a week.
"I think the bigger story for oil is the demand picture is brightening a bit as we think about the economic recovery globally starting to gain a little bit of momentum later this year," Fehr said.
Still, he said the sector is in a bit of a holding pattern until the OPEC meeting later this week when it could determine if output levels will change.
Shares of MEG Energy Corp. lost 2.8 per cent while Cenovus Energy Inc. was down 2.55 per cent.
The May crude contract was up 59 cents at US$61.56 per barrel and the May natural gas contract was up 3.4 cents at US$2.65 per mmBTU.
BlackBerry Ltd. was down 3.7 per cent to push technology lower.
Materials was slightly lower on a drop in metals prices that flowed from a stronger U.S. dollar.
The June gold contract was down US$20.10 at US$1,714.60 an ounce and the May copper contract was down 3.35 cents at US$4.03 a pound.
Consumer staples led the TSX with shares of Alimentation Couche-Tard Inc. and George Weston each up 3.7 per cent.
Stock markets could be volatile this week as investors reposition their holdings at the end of March and the first quarter.
And while North American stock markets will be closed for the Good Friday holiday, U.S. employment numbers will be released.
Fehr expects the results will be better than February when there was harsh weather and renewed lockdowns.
"I suspect that the jobs number on Friday will be reasonably healthy, not nearly to the levels that I think will shake out later this year as the economy hits its stride but I do think that we'll see better labour market numbers for March."
This report by The Canadian Press was first published March 29, 2021.
Companies in this story: (TSX: ATD.B, TSX:WN, TSX:MEG, TSX:CVE, TSX:WEED, TSX:BB, TSX:APHA, TSX:GSPTSE, TSX:CADUSD=X)
The Canadian Press
