TSX Today: What to Watch for in Stocks on Friday, May 6

The ongoing corporate earnings season and fears of slowing economic growth could keep TSX stocks highly volatile today, as investors continue to react to the Fed’s latest monetary policy move.

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TSX Today

Canadian stocks saw a big reversal on Thursday, as investors across North America continued to react to the U.S. Federal Reserve’s latest monetary policy move. The TSX Composite Index dived by 489 points or 2.3% to 20,696, marking its worst single-day losses in more than five months. While all key sectors on the Toronto stock exchange registered losses, healthcare, technology, metals mining, and consumer cyclicals mainly led the market selloff. Higher-than-expected jobless claims from the U.S. market and a series of corporate earnings misses added pessimism, taking the main TSX index closer to its lowest levels in 2022.

Top TSX movers and active stocks

Yesterday, Shopify (TSX:SHOP)(NYSE:SHOP) tanked by as much as 18% after the tech company released its first-quarter earnings report. The Canadian e-commerce company’s revenue missed analysts’ estimates. Its adjusted earnings for the quarter also stood about 70% lower than analysts’ expectations. Shopify reported US$0.20 per share in adjusted earnings in Q1 — down 90% from a year ago as COVID-restrictions-driven demand continued to subside. While SHOP stock pared some of the losses before closing, it still ended the session with more than a 14% drop, taking its year-to-date losses to around 70%.

SNC-Lavalin Group, Docebo, Gildan Activewear, Dye & Durham, and Altus Group were also among the biggest losers on the TSX, as they plunged by at least 10% each on Thursday.

On the flip side, the shares of Sleep Country Canada (TSX:ZZZ) popped by 8.5% during the session to $27.22 per share — a day after the company released its far better-than-expected March quarter results. During the quarter, Sleep Country’s total revenue rose by 13% on a year-over-year basis to $207 million — exceeding analysts’ estimates. Similarly, its adjusted earnings for the quarter more than doubled from a year ago to $0.56 per share, crushing Street’s expectation of $0.28 per share.

Based on their daily trade volume, Enbridge, Cenovus Energy, Manulife Financial, Baytex Energy, and Bombardier were the most active Canadian stocks yesterday. Nearly 17.8 million shares of Enbridge changed hands on the exchange in the last session, as it gears up to release its Q1 results on Friday.

TSX today: Top earnings and economic events

While crude oil and gold prices were trading on a slightly bullish note early Friday morning, the main TSX index might still open on a flat note today, as the ongoing corporate earnings season and fears of slowing economic growth keep investors on their toes. Apart from domestic employment change and purchasing managers index data, Canadian investors could watch the latest non-farm payrolls and unemployment data from the U.S. market this morning.

On the corporate events front, Canadian companies like Enbridge, Brookfield Renewable Partners, Brookfield Business Partners, TransAlta, Telus, Telus International, and Sprott are expected to announce their latest quarterly results on May 6.

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.

The Motley Fool has positions in and recommends ALTUS GROUP and Shopify. The Motley Fool recommends Docebo Inc., Enbridge, GILDAN ACTIVEWEAR INC., TELUS CORPORATION, and TELUS International (Cda) Inc. Fool contributor Jitendra Parashar has no position in any of the stocks mentioned.

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