A Thursday to Forget for the S&P/TSX Composite

Tomorrow’s another day!

| More on:
The Motley Fool

We had feared an ugly day early this morning, and certainly weren’t proven wrong.

The S&P/TSX Composite (^GSPTSE) started red, and just got redder as the day went on.  It’s ok to make up words after the market falls by almost 300 points in a day (299.72).

This 2.4% tumble was right in line with our neighboring markets to the south, as the S&P 500 and the Dow were down 2.5% and 2.3% respectively.

The reverberations of yesterday’s Fed meeting, which suggested an end to open market operations, as well as dubious data out of China, were behind today’s whipping.

Leading the TSX lower were two of the country’s big banks.  The Royal Bank (TSX:RY) and Scotia (TSX:BNS) were off by 2.9% and 2.7% respectively as market participants fled stocks that have anything to do with interest rates.  And pay a yield.  And just plain exist for that matter.

Because their weights aren’t quite as significant as the banks, mining stocks didn’t have the biggest impact, however, this was where some real carnage occurred.  The two biggies, that aren’t so big anymore, Barrick Gold (TSX:ABX) and Goldcorp (TSX:G) were down 7.8% and 7.9% respectively.

These declines were inspired by the price of gold.  Spot gold finished the day at US$1,281/oz for a 5.2% tumble.  In case you can’t tell, the Fed indicating it’s planning to roll the printing presses back into storage isn’t a good thing for the yellow metal.

On the bright side, Manulife Financial (TSX:MFC) made us Fools look kind of smart as it kicked in the biggest positive contribution to today’s market with a 1.4% gain.  As we suggested in a recent edition of Take Stock, Manulife is well positioned to benefit from the lift in interest rates that the Fed’s departure implies.

Foolish Takeaway

Given our market’s exposure to resources and financials, it’s surprising we didn’t underperform the U.S. markets by more today.

Because of this exposure, Canadian investors that own index oriented mutual funds or ETFs are taking on more risk than they are probably aware of.  To combat this issue, the Motley Fool has prepared the special FREE report5 Stocks to Replace Your Canadian Index Fund”.  Download this report at no charge, by simply clicking this link now.

The Motley Fool’s purpose is to help the world invest, better. Click here now for your free subscription to Take Stock, The Motley Fool Canada’s free investing newsletter. Packed with stock ideas and investing advice, it is essential reading for anyone looking to build and grow their wealth in the years ahead.

Follow us on Twitter and Facebook for the latest in Foolish investing.

Fool contributor Iain Butler is short $32 July 2013 put options on Goldcorp and owns shares of Barrick Gold.  The Motley Fool has no position in any stocks mentioned at this time

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

More on Investing

sale discount best price
Investing

Buy the Dip: 2 Strong TSX Stocks That Recently Went on Sale!

Consider buying Parkland Fuel (TSX:PKI) stock and another top dividend play on their recent corrections.

Read more »

A worker uses a double monitor computer screen in an office.
Dividend Stocks

TFSA Investors: 2 Winning Buy-and-Hold Forever Stocks in April 2024

Buy-and-hold stocks are easy enough to find if you limit yourself to dividends, but there are at least a few…

Read more »

worry concern
Dividend Stocks

Telus Stock Is Down to its Pandemic Low of Below $22: How Low Can it Go?

Telus stock is down 37% in two years and is trading near its pandemic low, making investors wonder how low…

Read more »

edit Businessman using calculator next to laptop
Energy Stocks

If You’d Invested $5,000 in Brookfield Renewable Partners Stock in 2023, This Is How Much You Would Have Today

Here's how a $5,000 lump-sum investment in BEP.UN would have worked out from 2023 to present.

Read more »

money cash dividends
Dividend Stocks

Portfolio Payday: 3 TSX Dividend Stocks That Pay Monthly

After adding these three TSX dividend stocks to your portfolio, you can expect to receive attractive monthly income for years…

Read more »

Dividend Stocks

The Top Canadian REITs to Buy in April 2024

REITs with modest amounts of debt, like Killam Apartment REIT (TSX:KMP.UN), can be good investments.

Read more »

edit Person using calculator next to charts and graphs
Stocks for Beginners

Where to Invest $7,000 in April 2024

Are you wondering how to deploy the $7,000 TFSA contribution increase in 2024? Here are four high-quality stocks for earning…

Read more »

Technology
Dividend Stocks

The Smartest Dividend Stocks to Buy With $500 Right Now

Some of the smartest buys investors can make with $500 today are stocks that have upside potential and pay you…

Read more »