BNN Bloomberg's closing bell update: Oct. 22, 2019
TORONTO -- Canada's main stock index barely budged Tuesday in the wake of an election result that didn't stray far from market expectations.
The S&P/TSX composite index closed down 26.93 points or 0.16 per cent at 16,391.52.
There was a quiet reaction on Canadian markets because the federal election produced a Liberal minority government that was largely predicted and already priced in by investors, says Anish Chopra, managing director with Portfolio Management Corp.
"If it was a different government, let's say it was a Conservative government, it would have been more positive for 1/8energy companies 3/8 but you're seeing a muted reaction pretty much everywhere," he said in an interview.
The Canadian dollar traded for an average of 76.37 cents US, building on a three-month high Monday at 76.36 cents US.
"We would have certainly expected a bigger move if there was some type of surprise in the election results, but it looks like the currency is effectively saying that there wasn't really much of a surprise in what happened in the results from yesterday's election."
Seven of the 11 major sectors on the TSX were lower led by technology as shares of Shopify Inc. dropped 6.2 per cent, following decreases in the U.S. sector.
Materials dipped on lower gold prices as miners such as Goldcorp Inc. decreased 1.6 per cent. The December gold contract was down 60 cents at US$1,487.50 an ounce and the December copper contract was down 1.35 cents at US$2.63 a pound.
Energy was higher on a lift in crude oil prices as OPEC said it is considering deeper supply cuts on worries over decreasing demand growth.
The December crude contract was up 97 cents at US$54.48 per barrel and the November natural gas contract was up 3.4 cents at US$2.27 per mmBTU.
Industrials also climbed as SNC-Lavalin shares surged nearly 14 per cent on investor hopes that the Liberal election win left open the possibility of a plea deal on fraud and corruption charges against the engineering firm.
In New York, the Dow Jones industrial average was down 39.54 points at 26,788.10 points. The S&P 500 index was down 10.73 points at 2,995.99, while the Nasdaq composite was down 58.69 points at 8,104.30.
U.S. markets were relatively flat as earnings results, although better than expected so far this quarter, were largely neutralized with companies like Proctor and Gamble raising their forecasts and others, including McDonald's coming in below expectations.
In addition, there is hope on the trade front between the U.S. and China after White House economic adviser Larry Kudlow said tariffs on Chinese goods scheduled for Dec. 15 could be withdrawn if talks progress, said Chopra.
"There's a little bit of a positive backdrop on trade so I think that's positive or at least neutral for markets."