TORONTO 鈥� sa国际传媒's main stock index was down more than 100 points Wednesday amid broad-based weakness, while U.S. stock markets also slumped.聽
It鈥檚 been a quiet week to start the quarter as investors await payroll data on Friday and the start to earnings season in the U.S. next week, said Greg Taylor, chief investment officer at Purpose Investments.聽
Nevertheless, some concerning economic data out of China and more hawkish messaging from the Federal Reserve weighed on markets Wednesday, he said.聽
Caution is 鈥渢he tone of the day,鈥� said Taylor.聽
The S&P/TSX composite index was down 100.98 points at 20,103.89.
In New York, where stock markets were closed on Tuesday, the Dow Jones industrial average was down 129.83 points at 34,288.64. The S&P 500 index was down 8.77 points at 4,446.82, while the Nasdaq composite was down 25.12 points at 13,791.65.
Minutes from the U.S. central bank鈥檚 last meeting showed growing divisions among policymakers, with some pushing for another hike even though the bank ended up pausing.聽
The minutes 鈥渏ust made more people start to wonder if the Fed is going to be still in the pattern of hiking rates, which is not a great combination if you get slowing economic data and higher rates,鈥� Taylor said.聽
The Fed is in a tough spot, said Taylor, with the last meeting clearly a contentious one. Investors are generally expecting another hike at the bank's next meeting, he said.
Meanwhile, new data suggested that growth in China鈥檚 services industry slowed more than expected last month.聽
鈥淭he service part of the economy has been what鈥檚 holding everything up of late, so weakness there is uncertain and that鈥檚 not good,鈥� Taylor said.聽
鈥淭hat caused a bit of a down start to the market.鈥�
Despite what this could mean for demand for oil, the price of crude rose more than three per cent Wednesday.
鈥淭here's some headlines in the Middle East about some potential supply disruptions out of Iran,鈥� said Taylor, 鈥渟o I think that just brought forward some of the geopolitical concerns.鈥澛�
That鈥檚 alongside production cuts announced earlier this week from Saudi Arabia and Russia which have helped boost the price of oil, he said. 聽
The August crude contract was up US$2.00 from Monday at US$71.79 per barrel and the August natural gas contract was down five cents from Monday at US$2.66 per mmBTU.
The Canadian dollar traded for 75.34 cents UScompared with 75.65 cents US on Tuesday.
The August gold contract was down US$2.40 from Monday at US$1,927.10 an ounceand the September copper contract was down three cents from Monday at US$3.77 a pound.
鈥� With files from The Associated Press
This report by The Canadian Press was first published July 5, 2023.
Companies in this story: (TSX:GSPTSE, TSX:CADUSD=X)
Rosa Saba, The Canadian Press
