The S&P/TSX Composite Index fell about 0.3% on Thursday, slipping below the 33,050 level, as intensifying military conflict in the Middle East heightened concerns over global energy supply. The resulting rise in crude oil prices further stoked fears of stubborn inflation. While energy producers outperformed the broader market, the information technology sector came under heavy selling pressure as investors moved away from higher-risk assets.
Domestic data underscored ongoing economic fragility, with the merchandise trade deficit widening to 3.6 billion dollars in January after a sharp drop in exports. Major miners Agnico Eagle, Barrick Gold, and Wheaton Precious Metals were among the key decliners, losing between 1.2% and 1.5%, as gains in bullion were increasingly offset by a stronger US dollar and rising Treasury yields. The financial sector was also solidly in negative territory. Market participants now look ahead to the February labour force data for clues on the outlook for national interest rate policy.