TSX Slides as Yields Hit Multi-Year Highs

The S&P/TSX Composite Index fell 1.6% to close at 35,751 on Wednesday as yields reached multi-year highs. Bond yields rose sharply as energy-driven inflation concerns persisted, with oil prices moving higher amid uncertainty over diplomatic efforts to end the US-Iran war and reopen the Strait of Hormuz. Strong US economic data also strengthened expectations that the Fed could deliver another rate hike this year. US Treasury yields soared to multi-decade highs, further pressuring Canadian bonds as domestic yields tend to track US rates. Major banks posted losses, with RBC down 2%, TD Bank falling 2.4%, BMO shedding 2%, and Scotiabank retreating 1.6%. Gold, silver, and copper extended their declines, pressuring miners. Agnico Eagle fell 3.9%, Barrick declined 3.2%, and WPM tumbled 5.4%.

The S&P/TSX Composite Index fell nearly 1% close to the 36,000 mark as lower metal prices pressured mining stocks, while oil prices moved higher, stoking energy-driven inflation fears. Gold and silver fell amid hawkish signals from US Federal Reserve officials, while copper also moved lower. Agnico Eagle fell nearly 4%, while Barrick and WPM shed about 3% each. Franco-Nevada declined 2.5%. In addition, CIBC downgraded Endeavour Silver (-8%) to “neutral” from “outperformer.” Meanwhile, oil moved higher amid uncertainty over diplomatic efforts to end the US-Iran war and reopen the Strait of Hormuz. Bond yields moved higher as energy-driven inflation concerns persisted despite the slowdown in the oil rally in recent weeks, pressuring credit-sensitive stocks such as major banks. RBC, BMO, and National Bank lost about 0.5% each.

Futures tracking Canadian equities fell on Wednesday as lower metal prices pressured mining stocks, while oil prices moved higher, stoking energy-driven inflation fears. Gold and silver fell amid hawkish signals from US Federal Reserve officials, while copper also moved lower. In addition, CIBC downgraded Endeavour Silver to “neutral” from “outperformer.” US-listed Canadian miners posted sharp losses in pre-market trading. Meanwhile, oil moved higher amid uncertainty over diplomatic efforts to end the US-Iran war and reopen the Strait of Hormuz. Bond yields moved higher as energy-driven inflation concerns persisted despite the slowdown in the oil rally in recent weeks, pressuring credit-sensitive stocks such as major banks.