TSX Ends Sharply Lower On Virus, Fed Taper Concerns

(RTTNews) - Canadian stocks plunged sharply on Tuesday as growing concerns about the newly detected coronavirus variant following doubts about the efficacy of existing Covid-19 vaccines against Omicron triggered heavy selling across the board.

As virus concerns rendered the mood bearish, the market reeled under selling pressure right through the day's session despite fairly impressive third-quarter GDP data.

Federal Reserve Chairman Jerome Powell's comments indicating the central bank could hasten a tightening of monetary policy added to the woes.

Powell told the Senate Committee that he thinks reducing the pace of monthly bond buys can move more quickly than the $15 billion a month schedule announced earlier this month.

The benchmark S&P/TSX Composite Index ended with a loss of 489.01 points or 2.31% at 20,659.99, the day's low, and the lowest level in about seven weeks.

Mirroring widespread selling, all the sectoral indices suffered notable losses. The Healthcare Index, the biggest loser, declined 3.86%. The Energy Index fell 3.68% as oil stocks fell on weak crude prices.

The indexes tracking the performance of real estate, consumer discretionary, information technology, consumer staples, financials and industrials shares slid 1.7 to 2.8%. The Materials Index drifted down 1.47%.

Manulife Financial (MFC.TO), Cenovus Energy (CVE.TO), Crescent Point Energy (CVE.TO), Lundin Mining Corp (LUN.TO), Toronto-Dominion Bank (TD.TO), Tourmaline Oil Corp (TOU.TO) and Hut 8 Mining (HUT.TO) shed 3.3 to 4.4%.

Suncor Energy (SU.TO), Enbridge Inc (ENB.TO), Enbridge Inc (ENB.TO), Kinross Gold Corp (K.TO) and B2Gold Corp (BTO.TO) also ended sharply lower on strong volumes.

Bank of Nova Scotia (BNS.TO) declined 2%. The bank reported fourth-quarter net income of $2,559 million, or $1.97 per share, compared to net income of $1,899 million, or $1.42 per share in the year-ago quarter.

The bank also announced a dividend of C$1.00 per share on the outstanding shares of the Bank, payable January 27, 2022 to shareholders of record at the close of business on January 4, 2022.

Data released by Statistics Canada before the opening bell showed the Canadian economy rebounded by 1.3% on quarter in the third-quarter, following an upwardly revised 0.8% contraction in the previous period.

The data also showed that annualized GDP Growth in Canada increased to 5.4% in the third quarter of 2021 from -3.2% in the second quarter of 2021.

Moderna CEO Stephane Bancel expressed apprehensions about the effectiveness of existing vaccines against the Omicron variant.

Bancel said in an interview to the Financial Times that it will take a couple of weeks to determine how much the mutations have affected the efficacy of the vaccines currently available in the market.

"Depending on how much it dropped, we might decide on the one hand to give a higher dose of the current vaccine around the world to protect people. Maybe people at very high risk, the immunocompromised, and the elderly should need a fourth dose," he said.