- TSX Composite fell 414 points (1.16%) to 35,334, with above-average volume confirming broad-based selling pressure across most sectors.
- WTI crude surged 6.94% to US$84.76/bbl on Middle East supply disruption fears, lifting Cenovus and CNQ by roughly 4% each.
- Gold hit a record US$4,104.70/oz, boosting senior miners Agnico Eagle and Kinross while the rest of Bay Street sold off.
- A hotter U.S. core PCE print of 3.4% crushed rate-cut expectations; Amazon and Apple earnings Thursday will set Friday’s tone.
The TSX Composite closed at 35,334 on Wednesday, July 29, down 414 points or 1.16%, as investors dumped rate-sensitive equities following a U.S. inflation surprise that revived fears of a higher-for-longer interest rate environment. The session’s range ran from an intraday low of 35,201 to a morning high of 35,589, with volume running roughly 18% above the 30-day average — a clear signal this was a conviction sell, not a drift. Bay Street tracked Wall Street lower, where the S&P 500 fell 1.52% to 7,316 and the NASDAQ dropped 1.74% to 24,443.
Winners: Energy and Gold Miners Bucked the Trend
Canadian energy producers were the standout winners as WTI crude surged US$5.49 or 6.94% to US$84.76 per barrel — approximately C$117.40/bbl at current exchange rates — after reports of a major pipeline disruption in a key Middle Eastern transit corridor triggered a global supply-risk repricing. Brent crude was even more dramatic, jumping 7.90% to US$90.73/bbl. Cenovus Energy (CVE.TO) jumped 4.8% to close at C$28.14, while Canadian Natural Resources (CNQ.TO) added 3.9% to C$51.67, making energy the only TSX sector to post meaningful gains on the day.
Gold miners were the second bright spot, riding bullion’s 1.69% advance to a new record of US$4,104.70 per ounce (approximately C$5,685/oz). Agnico Eagle Mines (AEM.TO) climbed 2.3% to C$134.50 and Kinross Gold (K.TO) rose 1.7% to C$22.88. With gold printing successive all-time highs, the senior producers are generating free cash flow at margins that would have seemed implausible two years ago.
Losers: Financials and Tech Took the Brunt
The Big Six banks were broadly lower as the inflation data reignited bond-market volatility and pressured net interest margin outlooks. Royal Bank of Canada (RY.TO) fell 2.1% to C$181.40, and TD Bank (TD.TO) dropped 2.4% to C$89.75 — its worst single-day loss in six weeks. The financials sub-index shed 1.9% collectively, its steepest one-day decline since May.
Canadian tech names mirrored the NASDAQ’s pain. Shopify (SHOP.TO) slid 3.2% to C$148.60 after already-stretched valuations met rising discount-rate anxiety. Constellation Software (CSU.TO) gave back 2.6% to C$5,214.00. Growth stocks are the most exposed to any repricing of the risk-free rate, and today’s session was a reminder that that relationship remains intact.
What Drove the Day
The catalyst was a U.S. core PCE reading for June that came in at 3.4% year-over-year, above the 3.1% consensus estimate — the Federal Reserve’s preferred inflation gauge signalling that the last mile of disinflation remains stubborn. Fed funds futures immediately repriced, with markets now assigning only a 22% probability to a September rate cut, down from 41% the day prior. The Bank of Canada’s next decision on September 10 is now also in sharper focus, with domestic traders watching whether Governor Macklem follows the Fed’s lead or diverges.
Tomorrow’s Catalysts
Wednesday’s volatility sets up a consequential Thursday. The U.S. Q2 GDP advance estimate lands at 8:30 AM ET — consensus sits at 2.1% annualized growth, but a miss or beat will move markets sharply given today’s inflation context. On the earnings front, Amazon (AMZN) and Apple (AAPL) both report after the bell, which will shape the NASDAQ’s direction and ripple into Canadian tech sentiment at Friday’s open. Domestically, watch the overnight oil complex: any further escalation in Middle East supply headlines could push WTI toward the US$87 resistance level, giving Canadian energy stocks another leg up. Silver at US$57.40/oz is also quietly approaching a multi-decade breakout level — precious metals traders will be watching closely.
