The Canadian stock market continued to drift down a bit for the second consecutive day on Wednesday. The S&P/TSX Composite Index settled at 20,742 — down 0.3% for the day. Meanwhile, key U.S. indexes like S&P500 and NASDAQ also ended the session in the negative territory. Despite a recovery in oil prices, weakening metals, and lingering concerns about slowing economic growth seemingly kept TSX investors worried yesterday.
On the monetary policy side, the Bank of Canada kept the interest rates unchanged, as it expected the economy to strengthen in the second half of 2021.
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On September 8, the shares of some big mining companies, like First Quantum Minerals (TSX:FM) and Teck Resources (TSX:TECK.B)(NYSE:TECK) fell sharply. While the First Quantum stock dived by nearly 7.5% on September 8, Teck Resources shares lost 4.1%. This selloff was mainly driven by the decline in copper prices for the second consecutive day.
It’s important to note that consistent weakness in the red metal prices could take a toll on these mining companies’ financial growth — especially profitability — in the coming quarters. Despite yesterday’s sharp losses, the shares of Teck Resources are still trading in the green territory on a year-to-date basis with 12% gains. In contrast, First Quantum extended its 2021 losses to 11.2% in the last session.
BCE, Suncor Energy, and Enbridge were among the most active TSX stocks on Wednesday that saw a jump in their daily trading volume.
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TSX stocks could open on a mixed to negative note on Thursday, September 9, as fears about slowing economic growth don’t seem to be ending soon amid rising Delta variant cases. TSX investors will also keep a close eye on the U.S. crude oil inventories this morning. Any unexpected change in the inventories data could lead to a big movement in oil prices and give direction to the Canadian energy stocks.
The shares of Shopify (TSX:SHOP)(NYSE:SHOP) will also remain in focus today after they shed 3.6% on Wednesday. Yesterday’s drop in the Canadian tech company stock price came after a Business Insider report claimed that the American tech giant Amazon is developing a new point-of-sale system. With this, Amazon could potentially steal the customers away from the e-commerce platform companies, including Shopify. While Shopify has posted outstanding sales and profitability growth in recent years, the entry of a tech giant like Amazon in its territory could be worrisome.
On the corporate events side, the Canadian retail chain Dollarama (TSX:DOL) will release its second-quarter results before the market opens today. Bay Street analysts expect the company’s July quarter revenue to be around $1.04 billion — up 2.8% year over year. Its adjusted earnings are expected to be 7.4% higher from a year ago at around $0.49 per share. DOL stock has traded on a positive note in 2021 so far, but it’s still underperforming the broader market with only 10.8% gains.
The food and grocery retailer North West Company and the business software provider Enghouse Systems will also announce their latest quarterly results on Thursday.