Canadian Stocks Retreat After Early Gains; TSX Down Nearly 1%

(RTTNews) - Canadian stocks retreated after an early upmove on Friday with data showing an increase in Canadian unemployment rate, and a less than expected addition in U.S. non-farm payroll employment in the month of August raising concerns about the strength of the labor market in the two nations.

Materials and technology stocks are weak. Industrials and healthcare stocks are also finding the going a bit tough, while a few stocks from communications and financials sectors have moved higher.

The benchmark S&P/TSX Composite Index, which advanced to 23,119.34 in early trades, gaining more than 130 points in the process, was down 225.90 points or 0.98% at 22,762.38 a little while ago.

Among materials shares, Capstone Mining Corp (CS.TO) is down more than 5%. Lundin Mining Corp (LUN.TO), Methanex Corp (MX.TO), Torex Gold Resources (TXG.TO), Iamgold Corp (IMG.TO) and Lundin Gold (LUG.TO) are declining 3 to 4%.

In the technology sector, Celestica Inc (CLS.TO) is down more than 6.5%. Bitfarms (BITF.TO) is down by about 5%. Lightspeed Commerce (LSPD.TO), Shopify Inc (SHOP.TO), BlackBerry (BB.TO), Computer Modelling Group (CMG.TO) and Docebo Inc (DCBO.TO) are down 2 to 3.4%.

Data from Statistics Canada showed employment in Canada rose by 22,100 in August 2024, following a 2,800 decline in the previous month, slightly below forecasts of a 25,000 increase.

The unemployment rate in Canada rose to 6.6% in August of 2024 from 6.4% in the earlier month, the highest since October of 2021, and surpassing market expectations of 6.5%.

Meanwhile, average hourly earnings in Canada increased to C$ 36.49 in August of 2024 over the previous month.

The U.S. Labor Department released a report showing employment in the world's largest economy rose by less than expected in the month of August.

The Labor Department said non-farm payroll employment climbed by 142,000 jobs in August compared to economist estimates for an increase of 160,000 jobs.

The report also said the increases in employment in June in July were downwardly revised to 118,000 jobs and 89,000 jobs, respectively, reflecting a net downward revision of 86,000 jobs.

Meanwhile, the Labor Department said the unemployment rate edged down to 4.2 percent in August from 4.3 percent in July.