Why Canada's Stock Market Just Took a 1.23% Hit

Toronto’s main index (S&P/TSX) nosedived 371.86 points to 29,906.55 on Thursday—and it wasn’t pretty. Here’s what went down:

The Profit-Taking Trap Nvidia’s killer Q3 earnings yesterday sparked a tech rally this morning, but traders got greedy. They bought the dip, watched the bounce, then immediately cashed out. Classic pattern: hype → pump → dump.

Tech Sector Gets Hit Hardest IT stocks crashed 2.55%, Materials tanked 4.48%, and Healthcare lost 0.98%. The culprit? Investors suddenly questioning whether mega-cap tech companies are burning too much cash on AI infrastructure without proportional returns. Overvaluation fears are back on the menu.

Why The U.S. Jobs Report Matters For Canada Washington reported 119,000 new jobs in September (way above the 50,000 expected). This actually spooked markets—stronger employment = Fed stays hawkish = fewer rate cuts coming. The December rate cut odds just dropped to 39.8%.

Bank of Canada’s Productivity Problem Canada’s central bank has basically maxed out its room to cut rates (already at 2.25%). The real solution? Boost productivity and worker income—but that takes years, not quarters. Meanwhile, the economy’s still squeezed by U.S. tariffs.

Good News For Grocery Stores The only sector with a pulse today was Consumer Staples (+0.87%). Metro Inc, Loblaw, and Couche-Tard all climbed as defensive plays kicked in.

The Bottom Line Canada’s market is caught between AI euphoria and recession fears. Profit-takers won the day, but the bigger question: Is this a healthy correction or a sign that investors are finally pricing in the real cost of the AI arms race?