TSX Today: What to Watch for in Stocks on Wednesday, August 23

TSX bank stocks may continue to experience heightened volatility before the Canadian banking sector’s earnings season starts.

Jitendra Parashar

Author Bio Jitendra Parashar is a financial journalist who has been writing for The Motley Fool Canada since June 2020. With more than 13 years of experience in financial journalism, equity research, and market analysis, he helps investors understand market developments and identify long-term investment opportunities. Before joining The Motley Fool Canada, Jitendra spent several years at Market Realist covering U.S. equities, major economic developments, and developments in the automotive and technology industries. He also worked in commodity and currency research at brokerage firms, gaining insight into how economic trends, central bank decisions, and geopolitical events influence financial markets. Jitendra writes for beginner investors, dividend seekers, and Canadians looking to build wealth over the long term. He also contributes to the daily TSX Today series, explaining key Canadian market developments and highlighting news investors should watch. Based in India, Jitendra follows Canadian and U.S. markets closely. Outside of work, he enjoys travelling in the Himalayas, street and nature photography, and exploring programming and artificial intelligence. Education MBA in Finance and International Business Bachelor's degree in Journalism Areas of Expertise Canadian and U.S. financial markets, long-term equity investing, dividend investing, macroeconomic and geopolitical trends, automotive stocks, emerging technologies, and artificial intelligence. Social Media Profiles LinkedIn Muck Rack Favorite Investment Quote “Simplicity is the master key to financial success.” — John C. Bogle

Published August 23, 2023 8:31 am EDT

The stock market in Canada traded on a negative note for the second day in a row, with a selloff in financial stocks ahead of the start of the Canadian bank earnings season. The S&P/TSX Composite Index fell 94 points, or 0.5%, on Tuesday to settle at 19,691, its lowest closing level since June 27.

Besides the weakness in bank stocks, losses in other main TSX sectors, like healthcare, energy, and consumer non-cyclicals, also dragged the index down.

Top TSX Composite movers and active stocks

Lightspeed Commerce, K92 Mining, Nuvei, and Park Lawn were the day’s worst-performing TSX stocks as they plunged by at least 2.7% each.

On the flip side, Celestica, Africa Oil, Northland Power, and Filo Corp rose at least 2.8% each, making them the top gainers on the Toronto Stock Exchange.

Transcontinental (TSX: TCL.A) shares traded on a mixed note yesterday after it announced an investment of US$60 million to promote the commercialization of recyclable flexible packaging.

With this investment to develop advanced mono-material recyclable flexible plastic packaging solutions, the Montréal-headquartered packaging company expects to produce “high-performance polyethylene films with enhanced heat resistance” and expand its Spartanburg, South Carolina-based facility. On a year-to-date basis, Transcontinental stock is down 16.6%.

Based on their daily trade volume, Great-West Lifeco, Canadian Natural Resources, Manulife Financial, Enbridge, and TD Bank were the five most active stocks on the exchange.

TSX today

Natural gas and West Texas Intermediate crude oil futures prices were trading on a bearish note early Wednesday morning. In contrast, metals prices across the board were showcasing strength. Given these mixed signals, I expect the commodity-heavy main TSX index to remain flat at the open today.

Besides important domestic retail numbers, Canadian investors may also want to closely monitor new home sales, services purchasing managers index, and building permits data from the United States this morning.

Overall, TSX bank stocks are likely to experience heightened volatility today, as Royal Bank of Canada and TD Bank gear up to announce their latest quarterly results on Wednesday morning.