Equities in Canada’s largest centre opened lower on Thursday following a rally in the previous session spurred by a less-hawkish U.S. Federal Reserve, while Shopify slumped after reporting its slowest quarterly revenue growth in seven years.
The S&P/TSX Composite dropped 116.11 points to open at 21,068.84.
The Canadian dollar skidded 0.13 at 78.38 cents U.S.
Shopify said it would buy U.S.-based logistics firm Deliverr for $2.1 billion, to help mitigate supply chain snarls. The company also reported a 22% jump in first-quarter revenue, which slightly missed estimates. Meantime, Veritas cut its rating on Shopify stock to sell.
Shopify shares caved $99.76, or 16.1%, to $518.54.
Bombardier reported a smaller quarterly adjusted loss, while Canadian Natural Resources’ quarterly net profit more than doubled thanks to rising crude and gas prices. Bombardier ducked three cents, or 2.3%, to $1.29.
French aerospace firm Latecoere agreed to buy Canada’s Avcorp for around 41 million Canadian dollars in cash. Avcorp advanced 1.5 cents, or 15.8%, to 11 cents.
National Bank cut the rating on 5N Plus to sector perform from outperform. 5N shares dived 29 cents, or 15.3%, to $1.60.
RBC raised the target price on Fortis to $65.00 from $60.00. Fortis sprang up 72 cents, or 1.2%, to $61.73.
ON BAYSTREET
The TSX Venture Exchange weakened 4.34 points to 803.04.
All but three of the 12 TSX subgroups got bruised, with information technology dumping 5.2%, health-care off 2.4%, and consumer discretionary stocks withering 1.4%.
The three gainers proved to be energy, ahead 0.7%, communications, clicking higher 0.4%, and utilities, up 0.3%.
ON WALLSTREET
Stocks fell sharply on Thursday, giving back most of the gains seen in the previous session after the Federal Reserve raised rates by half a point.
The Dow Jones Industrials gave up much of yesterday’s gains, losing 607.41 points, or 1.8%, to 33,453.65.
The S&P 500 loosed 93.77 points, or 2.2%, to 4,206.40.
The NASDAQ Composite stumbled 414.26 points, or 3.2%, to 12,550.59.
E-commerce stocks were a key source of weakness on Thursday following some disappointing quarterly reports.
Etsy and eBay dropped 17% and 6%, respectively, after issuing weaker-than-expected revenue guidance. Shopify fell more than 16% after missing estimates on the top and bottom lines.
Large tech stocks were under pressure, with Facebook-parent Meta Platforms falling 4.3% and Amazon descending 5.1%. Microsoft dropped 3.5%.
On the positive side, Papa John’s gained more than 2% after reporting a stronger-than-expected first quarter.
The Fed increased its benchmark interest rate by 50 basis points, as expected, and said it would begin reducing its balance sheet in June.
However, Fed Chair Jerome Powell said during his news conference that the central bank is “not actively considering” a larger 75 basis point
rate hike, which appeared to spark a rally.
Still, the Fed remains open to the prospect of taking rates above neutral to rein in inflation
In economic data, weekly jobless claims came in slightly higher than expected and labor productivity dropped 7.5% in the first quarter for its fastest decline since 1947.
Treasury prices jumped sharply, with yields falling to 3.04% from Wednesday’s 2.98%. Treasury prices and yields move in opposite directions.
Oil prices jumped another $2.91 to $110.72 U.S. a barrel.
Gold prices hopped higher $25.30 to $1,894.10 U.S. an ounce.