Canada’s main stock index fell at open on Friday, weighed by losses in the technology and consumer discretionary sectors.
The Toronto Stock Exchange’s S&P/TSX Composite index was down 61.96 points, or 0.41 per cent, at 15,082.92.
The Canadian dollar strengthened to its highest in more than one week against its broadly weaker U.S. counterpart on Friday, as oil prices rose domestic data showed that factory sales edged higher in September.
The Canadian dollar was trading 0.3 per cent higher at $1.3140 to the greenback, or 76.10 U.S. cents.
The currency touched its strongest level since Nov. 8 at $1.3137. For the week, it was on track to rise 0.5 per cent.
The price of oil, one of Canada’s major exports, rose on expectations that OPEC and its allies would agree to cut output next month but prices were still down on the week on concerns that the global market was oversupplied.
U.S. crude prices were up 2.3 per cent at $57.74 a barrel.
Canadian factory sales rose 0.2 per cent in September from August on higher shipments of autos as production ramped up after a series of assembly plant shutdowns, Statistics Canada said. Analysts in a Reuters poll had forecast a 0.3-per-cent gain.
In separate domestic data, net foreign investment in Canadian securities jumped to $7.70-billion in September from a year-low $2.63-billion in August on higher purchases of money market paper.
Gains for the loonie came as mounting uncertainty over Britain’s draft Brexit deal with the European Union cast a shadow over foreign exchange markets, while comments by Fed policymakers about slowing global growth weighed on the greenback.
U.S. stocks opened lower on Friday, as techology companies suffered sharp losses following disappointing forecasts from chip companies Nvidia and Applied Materials.
The Dow Jones Industrial Average fell 46.92 points, or 0.19 percent, at the open to 25,242.35. The S&P 500 opened lower by 11.66 points, or 0.43 percent, at 2,718.54. The Nasdaq Composite dropped 65.43 points, or 0.90 percent, to 7,193.60 at the opening bell.
Nvidia Corp. shares fell 19.1 per cent in early trading after the chip designer blamed unsold chips piling up as the cryptocurrency mining boom fizzles out.
Rival Advanced Micro Devices Inc. dropped 6.7 per cent and Micron Technology Inc., which sells memory to Nvidia for its gaming cards, declined 2 per cent.
Results for Applied Materials Inc., seen as a barometer for the chip equipment maker industry, also discouraged investors after its earnings forecast fell below Wall Street estimates. Its shares were down 4.5 per cent.
European stocks slipped again, and sterling and the euro remained volatile on Friday, as one of the most dramatic twists yet in the Brexit process compounded another turbulent week for world markets.
London, Paris and Frankfurt struggled to maintain a modest early bounce having been battered the previous day when Britain’s Brexit minister quit in protest over a draft deal with Brussels on leaving the European Union.
Sterling fared a little better than on Thursday when it slumped more than 2 cents versus the dollar in what was also its worst day against the euro since the post-Brexit vote fallout of 2016.
But with reports of a UK political coup still rife and a fear that the country could crash out of the EU without a divorce deal, it couldn’t get much beyond 88.50 pence per euro and $1.2875 on cable.
“As long as no deal remains as likely as it is, there is a risk of a sterling depreciation spiral that is self-intensifying,” said Ulrich Leuchtmannan, an FX strategist at Commerzbank in Frankfurt.
UK and euro zone government bond yields edged up as some stability returned to fixed-income markets.
Still, 10-year yields on German bonds, considered one of the safest assets in the world, were set for their biggest weekly fall in three weeks, in a sign that Brexit uncertainty and worries about Italy’s finances continued to support demand.
In Frankfurt, the head of the European Central Bank, Mario Draghi, said the bank still plans to dial back its stimulus at the end of the year, but acknowledged the economy had hit a soft patch and inflation may rise more slowly than expected.
“If firms start to become more uncertain about the growth and inflation outlook, the squeeze on margins could prove more persistent,” Draghi told a conference.
Some of Europe’s biggest funds who took part in a Reuters summit this week said they now think Draghi will be the first president in the ECB’s history not to have raised interest rates during their term.
Asian shares had ended their session firmer after reports the United States might pause on further China tariffs, but a near 17-per-cent plunge in Nvidia’s stock in after-hours Wall Street dealing had tempered the mood.
The chip designer forecast disappointing sales for the holiday quarter, pinning the blame on unsold chips piling up with distributors and retailers after the cryptocurrency mining boom evaporated.
“It started with Apple, then Nvidia ... Since performances of these companies set the tone for the global tech and chip industries, related Japanese stocks will likely be sluggish for a while,” said Takatoshi Itoshima, a strategist at Pictet Asset Management.
Europe’s tech stocks suffered too but Brexit remained the region’s main focus. Fears that UK Prime Minister Theresa May’s hard-fought deal could collapse had sent British markets into gyrations not seen since the June 2016 referendum on EU membership.
Britain’s FTSE 100 was at a three-week low, down 0.85 per cent, with FTSE 350 bank stocks down 1.4 per cent as lender RBS slid a further 4 per cent.
“If and when a vote on the withdrawal agreement occurs is uncertain. Whether the withdrawal bill is passed by both houses of Parliament is uncertain,” Joseph Capurso, a senior currency strategist at CBA, said in a note.
“Whether the Prime Minister resigns or is challenged for the leadership is uncertain. And, whether there is a second referendum and/or an election is uncertain.”
Away from sterling, the dollar dipped on its way to a fifth straight weekly gain, as cautious comments from the Federal Reserve’s newly appointed vice chair about growth saw the euro strengthen to $1.1390.
Also under water was the cryptocurrency Bitcoin which hit a one-year trough overnight, having tumbled 10 percent early in the week when support at $6,000 gave way. It was last changing hands at $5,547 on the Bitstamp platform.
In commodity markets, the weaker dollar gave gold a leg up to $1,223.
Reuters