Canada’s main stock index Tuesday snapped its longest winning streak since 2014 as weaker oil prices led shares lower.
The S&P/TSX Composite Index closed down 120.40 points, or 0.78 per cent, in Tuesday’s session, ending the day at to 15,233.76 points. Energy shares led the decline, falling about three per cent as oil retreated to US$52.77 per barrel.
The 12-day winning streak matched one in February 2014. The index had surged about nine per cent over the same period last year.
“Sometimes markets climb too fast too soon and have to reset. I think it’s more of a pullback after a pretty terrific move since Christmas Eve,” Barry Schwartz, chief investment officer and portfolio manager at Baskin Wealth Management, told Yahoo Finance Canada. “The market decided that it wanted to be in a grumpy mood on Tuesday.”
Darren Sissons, vice-president and partner at Campbell, Lee & Ross, said Tuesday’s pullback is a reminder that many of the headwinds that depressed the TSX in 2018 have persisted into the new year.
“Our friend in the south, he’s still fighting with the Chinese,” he told Yahoo Finance Canada. “The world is not as healthy as it seems.”
That said, both Sissons and Schwartz remain optimistic about Canadian stocks in 2019, given the parade of persistently strong quarterly results.
“We still feel that stocks are undervalued compared to your alternatives,” Schwartz said.