Aug 22 (Reuters) - Canada's main stock index fell to a near
three-week low on Monday in a broad-based selloff led by
cannabis, energy and financial stocks, as investors remained
nervous over the pace of rate hikes by major central banks and a
At 10:54 a.m. ET (14:54 GMT), the Toronto Stock Exchange's
S&P/TSX composite index was down 238.7 points, or
1.19%, at 19,872.68 its lowest level since Aug. 10.
The healthcare sector, which includes weed
stocks, lost 2.9, while the S&P/TSX Information Technology Index
dipped 1.7%, dragged by a 5% slide in Hut 8 Mining and
a 3.4% fall in Lightspeed Commerce.
"Technicians are suggesting a relatively minor correction
giving back some of the gains that we've had since the June lows
and then we will move onwards and potentially start another four
year bull market in equity up-cycle," Robert McWhirter,
president and portfolio manager at Selective Asset Management
"Industries that may do well during rising interest rates
would likely be defensives and banks as they had end up earning
larger profit margins spreads as interest rates move higher over
The Toronto market has rallied about 9.2% from its July
trough on the back of upbeat earnings and signs of cooling
inflation in the United States and Canada.
However, fears of a recession and a faster tightening in
monetary policy have slipped back into the market in the wake of
hawkish comments from Federal Reserve policymakers last week.
The index is still below 10.6% from its April highs.
Canadian banks are expected to post declines in profits on
average, when they report third-quarter results this week, as a
murky economic outlook drives up provisions for credit losses
(PCL) while market turmoil pressures capital markets and wealth
management results, analysts and investors said.
Canadian liquor and cannabis retailer SNDL Inc said
on Monday it would buy pot products maker Valens Company Inc
for about C$138 million ($106 million).
The energy sector, which accounts for 18% of the
TSX's market capitalization, dropped 1.7% as crude
prices dropped over 3.5% a barrel on concerns economic
slowdown may dent fuel demand.
(Reporting by Aniruddha Ghosh in Bengaluru; Editing by Shailesh