Marijuana Stocks Drag TSX Lower

By Baystreet Stock Market Update

Canada rejoins NAFTA talks

Canada’s main equity index traded in the red Tuesday led by declines in cannabis stocks while real estate and consumer discretionary sectors edged higher.

Cannabis producers Canopy Growth, Aurora Cannabis and Aphria fell between 2 percent and 8 percent and were the biggest decliners on the TSX.

The S&P/TSX Composite Index dipped 88.85 points at 16,355.54.

Canada’s top trade negotiator will join her Mexican and U.S. counterparts in Washington on Tuesday in a bid to remain part of a trilateral North American trade pact, as U.S. officials expressed optimism a NAFTA deal could be reached this week.

In earnings news — Bank of Montreal reported third-quarter earnings that were ahead of market expectations, helped by growth in the United States. BMO, Canada’s fourth-biggest lender, said earnings per share, excluding one-off items, rose 16 percent to C$2.36 in the quarter ended July 31, compared with the average analyst forecast of C$2.27, according to Thomson Reuters I/B/E/S.

The Canadian dollar strengthened to a nearly three-month high against its U.S. counterpart on Tuesday on the prospect of Canada reaching a deal this week to overhaul the North American Free Trade Agreement.

The Canadian dollar was trading 0.28 percent higher at 77.35 U.S. cents.

Gold prices were lower on Tuesday as trade tensions between the U.S. and China lingered. Comex gold futures for December delivery fell 0.83% to $1,200.59 a troy ounce.

ON BAYSTREET

The TSX Venture Exchange strengthened 0.15 points to 716.79.

Four of the subgroups were finished higher with real estate issues up 0.40%, consumer discretionary stocks ahead 0.15% and base metals up 0.10%.

On the downside – health-care issues sank 4.15%, gold stocks shed 2.92% and material issues gave back 1.04%.

Decliners on the TSX led advancers 914 to 667 with a total of 235 issues unchanged. Total trade volume was 304,574,730 valued at 5,988,400,163.

ON WALLSTREET

The S&P 500 and the Nasdaq on Tuesday finished at records for a third consecutive session after a measure of consumer confidence hit a nearly 18-year high, underscoring a continued expansion of the U.S. economy. However, the market’s gains were muted, with indexes closing off of intraday highs.

The Dow Jones Industrial Average rose 14.38 points to 26,064.02, coming within 2.1% of its record. The S&P 500 index edged up 0.78 points to 2,897.52, and the Nasdaq Composite Index added 12.14 points, or 0.2%, to 8,030.04.

Donald Trump announced a new agreement on trade Monday with Mexico that will both replace the current NAFTA pact – which covers an annual $1 trillion in trade – and leave Canada, the U.S.’s second-largest trading partner, without a bespoke deal.

Stocks also got a boost earlier in the trading day from a surge in the consumer confidence index, which jumped to 133.4 in August, an 18-year high.

A reading of June home prices showed growth slowing, while a measure of the trade gap in goods — services excluded — rose 6.3% to $72.2 billion from a revised $67.9 billion in June.

Best Buy Co. (BBY) reported fiscal second-quarter earnings of 91 cents a share, topping analysts’ forecasts by 8 cents. Sales of $9.38 billion also topped estimates, and a same-store sales increase of 6.2% beat expectations of 4.2%. The company’s third-quarter adjusted earnings estimate of 79 cents to 84 cents came in below forecasts of 92 cents, and the stock tumbled 5%.

Tiffany & Co. (TIF) rose 0.9% after reporting second-quarter earnings of $1.17 a share, higher than estimates of $1.01. Sales of $1.08 billion topped estimates of $1.04 billion. Same-store sales in the quarter jumped 8% and the jewelry retailer raised its earnings-per-share outlook for 2018.

Falling energy stocks, meanwhile, kept gains in the broader market in check as oil prices reversed gains from a day earlier ahead of a fresh supply of U.S. petroleum data, expected to show a slower pace of inventory drawdowns. On the New York Mercantile Exchange crude futures for October delivery lost 34 cents cents to settle at $68.53 a barrel.

U.S. government-bond prices slipped Tuesday as investors contended with an influx of new Treasury debt. The yield on the benchmark 10-year U.S.Treasury note settled at 2.884%, compared with 2.848% Monday.

This article provided by NewsEdge.